How will Britain’s banking sector fare in 2020?

Why investors looking to take a view on the UK economy’s prospects this year might want to start by looking to the banking sector.

2020 is turning into something of a “make or break” year for Britain. At the start of the year, the main item on the political agenda was to tackle talks on the UK’s future relationship with the European Union (EU). Technically, Britain left the EU at the end of last year. But the full impact of that decision won’t be felt until at least the end of this year, and will very much depend on how talks play out.

Then the coronavirus outbreak struck, turning everything upside down. In common with many other parts of the world, the UK has been in lockdown since late March. That in turn has battered the economy, with GDP plunging and unemployment soaring. At the same time, we’ve seen unprecedented measures from both the government and the Bank of England, designed to shield the economy as much as possible while it is in “hibernation”.

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