LONDON (Reuters) - Britain will not vote to leave the European Union but investors should expect lots of political “noise and posturing”, Mohamed El-Erian, chief economic adviser at Allianz SE, said in a note to clients.
Prime Minister David Cameron, who won an unexpectedly decisive victory in a general election in May, has promised to renegotiate Britain’s relationship with the 28-member EU and hold a referendum on membership by the end of 2017.
“There will be lots of political noise and posturing. But, when push comes to shove, Brexit will be avoided,” El-Erian said in the note. “It would be costly for all involved, and especially the UK,” he said of a British exit, or Brexit.
Reporting by Guy Faulconbridge; editing by Andrew Roche