Brexit shock will cause severe unemployment, recession: UK Treasury

London

WITHIN weeks of an exit from the European Union (EU), the British economy would slide into an inflationary recession with unemployment rising by at least 500,000, the UK Treasury has predicted.

Previously the Treasury projected poor economic performance in the long term, but the latest analysis forecasts "economic shock scenarios" in the event of Brexit. Unveiling the latest analysis, George Osborne, UK Chancellor of the Exchequer, said that the latest Treasury study focused on the immediate economic impact if voters chose to exit the union in the June 23 referendum.

"The analysis in this document comes to a clear central conclusion: a vote to leave would represent an immediate and profound shock to our economy," Mr Osborne said. "That shock would push our economy into a recession and lead to an increase in unemployment of around 500,000, gross domestic product (GDP) would be 3.6 per cent smaller, average…