The UK economy has held up surprisingly well since June 2016’s vote to leave the European Union, but the gloves might be now coming off. Economic growth is slowing in Britain as the brakes of uncertainty drag.

The latest data from consultant PwC anticipate UK GDP growth of 1.5% this year, slowing again in 2018 to 1.4%. That’s versus 1.8% progress in 2016, according to PwC’s latest UK economic outlook report.

Consumers are right at the heart of the matter with reduced spending in the face of rising inflation and limited wage growth.

Higher borrowing has allowed high street and online spending to remain reasonably robust to date, but as PwC points out, ‘there are limits to how much further this can go as household savings ratios have already fallen to very low levels.’

Business investment is also showing some signs of strain. Much of this is down to limited visibility, which makes budgeting for business far harder.

The weak pound and exports may offset some of this pressure, especially for the UK’s very biggest companies in the FTSE 100 index. Many earn a lot of income from overseas markets, so declines in sterling make British goods sold overseas more competitively priced.

That goes a long way to explain why the FTSE 100 continues to trade at close to record levels, at about 7,400. That’s less than 2% below the all-time highs, hit first in May and again in June.

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