“We’re not in the Armageddon camp,” said Jean-Michel Six, the rating agency’s chief economist for Europe.
“Devaluation acts a shock absorber. It stimulates exports and makes the London Stock Exchange more attractive to foreign investors,” he said.
The UK economy should muddle through with growth of 1.5pc this year, 0.9pc in 2017, and 1pc in 2018, shielded from the storm by fiscal largesse and monetary stimulus a l’outrance.
The benign outcome assumes that the Bank of England will cut interest rates to zero and relaunch quantitative easing, buying £100bn of bonds in each of the next two years.
It also assumes that Britain joins the European Economic Area – the "Norway model" – or a close equivalent that safeguards full access to the single market and preserves the City’s passporting rights for financial services.
“If that does not happen, it could be extremely negative,” said Mr Six. A hostile EU divorce could push the housing market into a downward spiral as an exodus of migrants compounds the damage from an economic slump.
In my opinion with who ever becomes PM, if Article 50 is not invoked soon after, as in days after, a Snap Election is on the cards.
