What a close call this referendum was – 52% to leave. How will things pan out for engineering companies and industry in general? Article 50 still needs to be invoked by parliament with cross party MPs officially voting in favour of brexit. The details of the mechanism to exit this side in the UK and in Brussels is not always clear, and is unchartered waters for both . The effects of this political upset are still rippling through Europe and the world one week later.
The pound to the dollar exchange rate is the lowest since the 1980s, which will effect our businesses. FTSE100 share prices have dropped significantly but have recently bounced back.
For exporters, the drop in the pound makes their goods cheaper overseas and could help lift flagging demand. Until recently, manufacturers had been complaining that a relatively strong pound was hampering their competitiveness and contributing to a slowdown in the manufacturing sector. Conversely for importers, materials & certain goods are more expensive and so hamper profit margins & profitability. Profitability may well be affected also by new trade tariffs with Europe.
Business leaders and politicians all agree choppy waters are still ahead.
I feel we need to look heavenwards as a nation in these times, for help & wisdom to see us through these unsettling times to a new prosperous and peaceful future.
Hope you have a good month
All the best