Brexit economy: UK faces squeeze on living standards

The latest monthly Guardian analysis finds signs of a slowdown as prices rise and real pay shrinks

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British households are being warned to prepare for a tightening squeeze on living standards, as a Guardian analysis shows the Brexit vote's blow to the pound is stoking inflation while pay packets are shrinking in real terms.

As Theresa May prepares to trigger article 50 next week, kicking off the formal process of the UK leaving the EU, the economy continues to defy the doomsayers who predicted a sudden downturn after the referendum. But signs of a slowdown are now emerging as higher prices put pressure on companies and consumers alike.

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