May 13, 2016
Brexit polls inconclusive, but Leave is getting stronger
The FT's Brexit poll tracker still has the two sides running neck-and-neck, but it is noteworthy that of the last ten polls six have the Leave camp ahead. And of the three polls in May, two have the leave camp ahead. The latest ICM poll has Leave at 46% and Remain at 44%, while the latest YouGov poll has Remain at 42% and Leave at 40% with a correspondingly higher number of undecided voters. The numbers are telling us that the outcome remains wide open, and most likely subject to further events between now and polling day on June 23.
The Bank of England yesterday gave a predictable warning of the Project Fear variety. This is about as stark as it gets:
"A vote to leave the EU could materially alter the outlook for output and inflation and therefore the appropriate setting of monetary policy. Households could defer consumption and firms delay investment, lowering labour demand and causing unemployment to rise."
We noted a comment from Tom Goodenough in his Spectator blog in which he made the point that warnings don't come much starker than this, and compares this with David Cameron's warning that Brexit would lead to war. The real problem with statements like these is that they could become self-fulfilling.
We also noted a comment by Ruth Lea in the FT, with which we largely agree, that the post-Brexit situation will not be as bleak as people suggest.
"But all would not be lost. In some areas the EU already has “regulatory equivalence regimes” to allow non-EEA financial services firms — Swiss insurers, for example — to trade with the EU in a way that is similar to the passport. Given the UK already complies with EU financial regulations, “regulatory equivalence” should be all but automatic on Brexit."
She also makes the point that the lobbying power of German exporters to the UK in particular will be strong enough to prevent a vindicative response.