AKIPRESS.COM - The U.K. economy’s sweet spot is about to be challenged. Prime Minister Theresa May kickstarted the formal withdrawal from the European Union on Wednesday, leaving businesses and investors facing the realities of Brexit and changes to everything from regulation to the movement of workers and goods.

There’s also a lack of clarity over whether a good deal -- or any deal -- can be reached.

Bank of England Deputy Governor Ben Broadbent said last week the economy was in a post-referendum, pre-Brexit “sweet spot” for exports. That situation, where the pound has fallen but trading rules are as yet unchanged, may not last, according to Broadbent, Bloomberg reported.

While forecasts of the referendum’s economic impact have so far proved too pessimistic, most were about “when the trade barriers come into place,” said Swati Dhingra, an economics lecturer at the London School of Economics who specializes in trade policy. “That hasn’t happened -- we haven’t exited yet.”

Brexit uncertainty is already proving a factor in some companies’ investment plans, while faster inflation as a result of sterling’s depreciation may weigh on consumer spending. But while economists forecast a slowdown this year, the consensus is for a very modest drop to 1.7 percent from 1.8 percent. The economy still has momentum, and there’s a chance that the pickup in inflation is at least partly matched by wage growth, softening the hit on consumers.

May invoked Article 50 of the EU’s Lisbon Treaty in a letter to EU President Donald Tusk on Wednesday, striking a conciliatory tone. In response, European leaders pledged to work “constructively” with the government in London, expressing hope that the U.K. would remain a close partner.

Leaders from the bloc won’t meet formally on the issue until April 29 and discussions on the future trading relationship won’t commence until progress has been reached on issues such as the cost of exit and rights of EU workers in the U.K.