The economic fallout from the Brexit vote

It is bad:

The UK economy has suffered a “dramatic deterioration” since Britain’s vote to leave the EU, according to a closely-watched survey of activity, which has slumped to a seven-year low.

A special edition of purchasing managers’ index (PMI) – a well-regarded survey of activity produced by research group Markit – has been published to provide a picture of how the UK economy has fared after the referendum. The picture is not pretty.

The PMI survey for Britain’s powerhouse services sector – which accounts for nearly 80 per cent of the economy – has dropped to a seven year low of 47.4 for July from 52.3 at the June survey. Any reading below 50 indicates contraction. The outcome was far lower than economists’ forecast of a reading of 48.8.

The manufacturing PMI has also dropped to 49.1 from 52.1 in June. The July reading is a 41-month low although economists had expected a slightly worse reading of 48.7.

The composite PMI – combining both manufacturing and services readings – also fell dramatically to 47.7 from 52.4 previously against a forecast of 49. This is the lowest reading since April 2009, when the UK was struggling through the financial crisis.

Here is the Fast FT piece.