It’s been more than four years since UK citizens voted to leave the European Union. And politicians across the pond have been debating, resigning, and campaigning ever since. Meaning you’ve probably heard about a million Brexit updates so far. The latest: Boris Johnson wants to say ‘nvm’ to parts of the agreement the UK signed with the EU about how trade would work with Northern Ireland. Cue: more drama.
Here’s what this drawn-out divorce could mean for your wallet.
You might spend less on vacation...one day. The pound’s gotten pounded (sorry) from all the Brexit back-and-forth. After a steadier few months, recent developments sent it falling again. That’s actually good news if you’re thinking about hitting the UK when travel is a thing again. A stronger US dollar means your money will go further. Another round of tea on you.
US companies could take a financial hit. A weaker pound means US products are more expensive for consumers in the UK. Which can cause sales to drop. A lot of US businesses have used the UK as a token mutual friend for trade with the EU. Without that connection, global trade gets even more complicated.
Stock prices might be even shakier. As soon as Brexit became a thing, global markets freaked out. (Then they calmed down.) As a general rule, the stock market hates uncertainty...and a lot of Brexit’s economic impacts are still uncertain. But quick PSA: stock prices jump around all the time. Not getting motion-sick is part of playing the investing game well. Over the long run, the US stock market has always trended up, up, and up.
theSkimm: Brexit news might make you feel like when that person you aren’t even dating tells you it’s over: pretty confused. And even though the UK officially broke it off with the EU in January, there are still a lot of unknowns. So stay tuned, try to stay calm and carry on if future trade-deal negotiations shake up stock prices, and consider adding “visit Big Ben” to your post-coronavirus bucket list.
Subscribe to Skimm Money
Your source for the biggest financial headlines and trends, and how they affect your wallet.