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Brexit predictions one year on. How did I do with my crystal ball?

Jasmine 26th Jul 2017 One Comment

Reading Time: 9 minutes

Do you remember the Brexit predictions I made in this article last year?

Take a look. We haven’t changed anything in that article since I wrote it.

What I have done in the meantime, though, is put together a spending calculator with the guys at Comparethemarket.com to work out how much more (or less) we are likely to have to pay for day-to-day expenses in the next twelve months. We have looked at mortgages and rents, food, petrol, clothes, gas and electricity, and car and home insurance. Take a look here to see how your expenses are likely to change in the next twelve months.

So, how did my predictions hold up and what do I think will happen now that we have triggered Article 50.


Will prices go up because of Brexit?

what did I say?

This is what I said in June 2016:

“Many of them will yes….The first to go up will be petrol prices. This is because Sterling (the pound) has dropped significantly against the dollar and is likely (only likely – not definitely) to stay low for a while….as we in the UK are net importers of goods (in other words, we buy more things from abroad than we do from the UK), while the pound is low against other currencies (and that’s likely to be for a while) it will mean that products we import will be more expensive. That will cover all sorts of things from food to clothes to gadgets and more.”

what has actually happened

Prices have gone up. Petrol prices are up by about 20%, food prices by around the same amount and gadgets – particularly laptops and phones – are up by 20%,

what is likely to happen in the next year?

More of the same.

As you can see by using the Comparethemarket calculator here, we are expecting food prices particularly to continue going up. Petrol has gone down a little in the last few months as crude oil prices have softened but it’s likely to go up further in the next twelve months.


What will happen to interest rates now?

Pile of money overlay-ed with clock image

what did I say?

“because the economy is in such turmoil, and is likely to be for a few months to come at least, it’s more likely that the Bank of England will put rates down or keep them as they are. This is because they want to get people and businesses borrowing more.”

what has actually happened?

Interest rates were dropped by 0.25% very quickly after the Referendum vote in order to keep the economy going and encourage people to spend. In large measure that worked although now that the cost of living has risen significantly, people’s disposable income has reduced so they’re not spending as much on fun stuff as they did before. This is making it tough for some businesses that depend on the UK consumer giving them their money!

what is likely to happen in the next year?

It’s really open season when it comes to interest rates.

My feeling is that they are not likely to go up because the economy will weaken even further. However, as prices continue to rise – and more members of the Bank of England’s Monetary Policy Committee last month voted for a rise in interest rates – we could see an uplift of at least 0.25%.


What will happen to mortgage rates?

Tracker Mortgage graph

what did I say?

“If, as I’ve suggested above, interest rates go down then this could mean that we have some very cheap mortgages on the market.”


“It will probably be better for people remortgaging than new buyers because lenders will be very cautious about who they lend to.”

what has actually happened?

Interest rates did go down and we do have some of the cheapest mortgages on the market ever. Take a look here to see how much you could save by switching your mortgage.

However, although there are certainly really good deals for remortgagers, there is also a lot of competition in the market still and with the Help to Buy scheme encouraging mortgage provides, there are more 95% mortgages around for first-time buyers.

what is likely to happen in the next year?

I think that interest rates will stay as they are so mortgage rates will stay low. In fact, they might even get lower, or at least mortgages will become more flexible, as fewer people take the plunge and buy a property in these uncertain times.

Property prices are likely to continue to fall, particularly in London and the South, where they are already slipping, because people don’t want to jump into the unknown with a large amount of money when the political and economic situation is so uncertain.


Check out the latest, cheapest mortgages to switch to here


What will happen to house prices?

Stacks of coins and model house

what did I say?

“In the short-term at least they are likely to go down.”

what has actually happened

it’s a mixed bag. In London and the South East they have gone down but, overall, average prices across the UK have continued to go up, albeit at a slower rate.

what is likely to happen in the next year?

I think there will be a reduction in house prices generally in the UK, although some areas (the cheaper ones where more young people are moving to) could hold up.


What will happen to savings?

Putting coins in piggy bank

what did I say?

“If interest rates go down, as I suggested above, then the savings rates will go down even further.”

what has actually happened?

Interest rates went down and savings rates went down. Not only that, but the amount we save as a proportion of our income has dropped to the lowest ever since the 70’s, according to the Office for National Statistics.

what is likely to happen in the next year?

I think that both savings rates and the amount we save will continue to drop. It’s possible that interest rates will go up in response to rising inflation but I think that the increasingly weakened economy will prevent that.


Find the best savings rates for your hard-earned cash here!


Will Brexit affect my pension?

Pension puzzle

what did I say?

“The State Pension is not connected to the EU so it will continue whether we stay in it or leave.

However, the ‘triple lock’ that was set by the Government earlier this year could be affected if our economy does badly in the next few years.”


“The stock market volatility isn’t helping pension or other funds that are largely invested in stocks and shares. It’s likely that right now a lot of these funds have lost money because of the dips in the market. However, the stock market can go up as well as down and it’s quite possible that it could rally and even do much better later on.”

what has actually happened?

The Government looked like it was going to scrap the triple lock but the Democratic Unionist Party have stopped that as part of its terms for supporting the minority Conservative Government.

The stock market here and in the US has done amazingly well over the last year, largely because Sterling is low. This has been good for a number of large companies that export and it has encouraged some outside investment as British goods and businesses are seen as being cheap at the moment.

what is likely to happen in the next year?

A lot of investors are expecting a crash in stock markets generally as they have risen so fast and so far in the last year. Many feel this is unsustainable. However, no one knows when it will crash – it could be in the next year or not for a couple more years. It’s hard to call.

The triple lock is likely to stay while the Conservatives need the DUP but as soon as a Government gets in that is strong and doesn’t need to assuage voters it is likely that it will be dropped as it’s too expensive for the country to keep going.


Will my holidays be more expensive?

Family on the beach

what did I say?

“With the falling pound, if you’re going abroad for your holiday it’s likely that your money won’t go so far, particularly if you’re going to America.”

what has actually happened?

According to research by Santander, this summer the pound is worth an average of 12.8% less in holiday hotspots.

what is likely to happen in the next year?

It’s likely that Sterling will continue to be weak and could go down even further if the political wrangling isn’t resolved and Brexit negotiations continue to be problematic. This means holidays abroad will be even more expensive, although that’s good news for the British tourism industry which should see a big uptick in business this year and next.


Should I worry about my investments?

Invest in gold

what did I say?

“it’s never worth worrying about investments and I certainly wouldn’t pull your money out of anything right now – not until the dust settles (probably in a few months’ time) and we can see things a bit clearer.

It’s always a good idea to have your investment money in a range of different products (pension, stock market, property, savings accounts etc) so that if one of them does badly, you can rely on the others. It’s also a good idea to give things time to adjust.”

what has actually happened?

The stock market has done phenomenally well in the last year so if you kept your money there you will have done well and your pension fund is likely to have done well too.

what is likely to happen in the next year?

It’s quite possible that the stock market will continue to do well into 2018. Property investments are likely to do much worse though.


Will I keep my job?

Professional man in a suit adjusting his tie

what did I say?

“Of course a lot of jobs will stay. In any country situation there are things that have to be done and people that have to do them. However there are some areas such as financial markets and possibly some manufacturing sectors that might suffer because the companies decide they want to move operations to an EU country.”

what has actually happened?

Jobs have stayed pretty stable since the Referendum. In fact, there is a massive shortage of workers in key areas such as the NHS, transport and the caring professions generally. We also have a dire shortage of highly-skilled workers in the tech arena. So, get studying – there’s work out there for you!

what is likely to happen in the next year?

It’s likely that the shortages of workers in key areas will continue which is good news if you are trained in these areas.


Can the Brexit decision be reversed?

Brexit undo arrow concept

what did I say?

‘It’s pretty much a done deal.

The Referendum was not a legally-binding decision. In the end it’s up to Parliament to make the final decision and enact Article 50 which will set in motion our long exit from the EU.

However, the fact that the country has voted, by a majority of 4%, to leave the EU means that Parliament is likely to accept ‘the will of the people’ and vote to leave, even though the majority of MPs believe it is wiser to stay.”

What has actually happened?

We have triggered Article 50 and since then it’s been a mess. The Conservative party is in disarray. A General Election that should have brought more power to Theresa May has given her less with a big protest vote around the country against both Brexit and austerity. Even the Leave leaders are at each others’ throats (Gove, Carswell, Farrage et al).

what is likely to happen in the next year?

Various people, such as financier George Soros are saying that it will prove impossible actually to leave the EU, but it’s not clear what will happen if we can’t.

Frankly, anything is possible in the next year, but if you want me to make a prediction, I agree with Soros that it will prove physically impossible to break away. If the winds are favourable, something will happen to make the EU desperate to keep us while we realise we can’t leave. If they are unfavourable we may have to crawl back to the European leaders and be forced to accept more rules than we had before we started all of this.

Lets see!


To find out how your own personal finances are likely to be affected by Brexit in the next 12 months, have a go at the Comparethemarket calculator here and see how much you will need to set aside to pay your bills (or switch to save!).


What do you think will happen in the next 12 months? Will Article 50 have a positive or negative effect on our economy and our lives? Tell me in the comments below.

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4 years ago

Still May is messing around, a No deal Brexit is that the 17.4 million most;y want.

Jasmine Birtles

Your money-making expert. Financial journalist, TV and radio personality.

Jasmine Birtles

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