Britain's decision to leave the EU has led to a "dramatic deterioration" in economic activity, not seen since the aftermath of the financial crisis. In her recent speech, the UK Prime Minister Theresa May has told that she ill initiate article 50 (The process to start leaving EU) before March 2017. Businesses will now start feeling that the clock is ticking, but really this whole process could take another two years to complete.
Data from IHS Markit's Purchasing Managers' Index, or PMI, shows a fall to 47.7 in July, the lowest level since April in 2009. A reading below 50 indicates contraction. But the market is now starting to get stable with David Cameron stepping down and the new Prime Minister taking over, even though the change in leadership didn't help Britain's cause, now they know for sure who is going to lead them trough this transition. Both manufacturing and service sectors saw a decline in output and orders. However, exports picked up, driven by the weakening of the pound. The report surveyed more than 650 services companies, from sectors including transport, business services, computing, and restaurants.
For the majority of businesses in Britain the possibility the UK leaving the European Union is a major source of concern. Both the break with the EU and the uncertainty associated with it would be bad for business and damaging to the UK economy. But the UK is one of the largest buyers in the European Union so most of the countries need to have some kind of trade pact with all these exporting countries because for most of them they can't afford to lose Britain as their customer.
Over time people and businesses will gain confidence in UK and the market conditions will be back to normal.