The Treasury has published its long-awaited analysis of the likely short-term impact of Brexit. The study suggested that Brexit would wreak substantial short-term damage to growth prospects, though we would view the HMT results as more of a worst-case scenario than the most likely post-Brexit outcome.The weeks data provided further evidence that companies are in wait-and-see mode until after 23 June. But consumers are continuing to power ahead, which should help to limit the degree to which growth slows in Q2. The Chancellor will then need a strong rebound in activity after the referendum if his fiscal consolidation is to remain on track.
