DAVY VIEW

Markets have given a muted reaction to the news that the EU has granted a disappointing, shorter-than-expected six-month Article 50 extension to the UK. This means a bounce-back in UK GDP growth in H2 2019 is less likely. The risk of a highly disruptive ‘cliff-edge’ Brexit has been negated and Irish GDP growth should remain strong, but the uncertainty could hurt housing transactions and the long-awaited pick-up in bank lending to the SME sector.