Brexit Results Prove Increasingly Costly To Britons
RENEE MONTAGNE, HOST:
Since the U.K. voted to leave the European Union last summer, the country's currency - the pound - has lost about 16 percent of its value against the dollar. Most of the damage, according to economists, was self-inflicted. NPR's Frank Langfitt reports on how plans for a sharp break with the EU are already coming at a price.
FRANK LANGFITT, BYLINE: Thousands of tourists cram Westminster Bridge each day to see Big Ben.
Along with vendors selling Keep Calm T-shirts, there's almost always a guy in a kilt playing bagpipes. Linda Schubert first came to London on her honeymoon 37 years ago.
LINDA SCHUBERT: It just always seemed like a really expensive city.
LANGFITT: But Schubert, flew in last weekend from Dallas, says this time they're bargains even at Harrods, one of the city's famed department stores.
SCHUBERT: I was told by a friend who just got back last week that his wife's new shoes were $350 cheaper here at Harrods.
LANGFITT: Than in the States? Or...
SCHUBERT: Exactly. She just bought them to come on the trip, so his advice was run to Harrods and take lots of cash.
LANGFITT: Of course, this is an extreme case. The cheaper pound is good news for American tourists like Linda Schubert, but bad for her son Brandon, who works here as an interior designer. Brandon's paid in pounds.
BRANDON: It's obviously disappointing for people who live here to know that all of a sudden if you take their wealth in global terms, they're sort of 15 percent poorer than they were before.
ANGUS ARMSTRONG: The prediction of the pounds falling was really widespread. Just about every economist thought this would happen.
LANGFITT: Angus Armstrong is director of macroeconomics at the National Institute of Economic and Social Research, a London think tank. He says that after the Brexit vote, the value of the pound fell because people thought less access to the EUs giant market would hurt the economy. Many hoped the U.K. might somehow stay inside the single market until last week when Prime Minister Theresa May told her Conservative party this.
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PRIME MINISTER THERESA MAY: We are leaving to become once more a fully sovereign and independent country, and the deal is going to have to work for Britain.
LANGFITT: Which is Brexit speak for sharp split. Again, Angus Armstrong.
ARMSTRONG: It looks like a so-called hard Brexit that we really are pulling out most of our connections to the European Union, and that's why the currency fell further.
LANGFITT: The pound dropped again this morning trading below $1.23 Most economists think it has yet to hit bottom. Frank Langfitt, NPR News, London. Transcript provided by NPR, Copyright NPR.