Canadian businesses, investors and economists are preparing for the prospect of one of the country’s biggest trading partners leaving the European Union.
"The UK is one of Canada's top trading and investment partners, however the small relative size of these relationships points to a muted direct effect on Canada's economy," RBC Economics said in a note to clients.
However, the note also warned that there could be a "return to risk aversion in financial markets” which is “expected to put downward pressure on oil prices, government bond yields and the Canadian dollar."
Canadian Manufacturers & Exporters group commented that it was “deeply concerned” by the Brexit.
The organisation said Brexit causes immediate risk to financial currency and commodity markets and "may tighten credit conditions around the world for Canadian businesses."
“Yesterday's vote will also impact business planning and supply chain management among Canadian manufacturers selling into or investing in both the UK and the EU," the group said in a release. "Moreover, Brexit will strain the movement of labour and skilled professionals into and out of the single market and cloud recent efforts toward greater harmonization of product specific regulation across the region,"
Aimia Inc. (company that runs the Nectar loyalty-points program in the United Kingdom) said that it expects a period of uncertainty in the near term as a result of the vote.
Aimia's CEO Rupert Duchense said that the negative effect on its cash flow due to a weaker British pound will be challenged by decreased costs in its UK business.
The British vote to exit the EU had an immediate impact on stocks, with the British pound plunging to its lowest level in three decades and world stock prices falling.
Read the June 2016 issue of Business Review USA & Canada magazine