Since the June 23, 2016 vote, the British economy defied gloomy recession predictions. But other predicted events did occur, such as a sharp fall in the pound and rising inflation.

Few events outside of war can have quite as much impact on the economy of a country as Britain’s decision a year ago to leave the European Union.

The momentous vote on June 23, 2016 has the potential to sever Britain’s ties to its main trading partner, a grouping it has spent more than four decades building ever-closer ties to. From common subsidies for farmers to standards on consumer products and banishing all types of impediments to trade, the British economy is deeply enmeshed in the workings of the E.U.

Since the vote, the British economy defied the gloomy recession predictions of many, including the British Treasury and the International Monetary Fund. Other forecasts like an immediate house price crash didn’t materialise either.

But other predicted events did occur, such as a sharp fall in the pound and rising inflation. And now that the official two-year Brexit process has begun, there are renewed signs of economic pain.

So where is the British economy, one year later? Here’s a brief guide.

Still growing, just

The British economy did not contract in the wake of the Brexit vote as many had warned. In fact, for much of the time since, it’s grown faster than its peers in Europe, largely because of a sharp fall in the value of the pound. The 15 percent decline made exports cheaper, a boon to growth. However, the economy is now weakening amid the Brexit uncertainty and as the pound makes imports more expensive. The British economy is even trailing the likes of Greece Britain grew 0.2% in the first three months of the year, lower than any other Group of Seven economy. While Britain has faltered, previously struggling continental economies like France have gained momentum, potentially affecting the dynamics of the Brexit talks, which started this week.

Recession ahead?

The worry is that the pre-Brexit doom-mongers may be proved right should Britain fail to secure a comprehensive trade deal with the E.U. the so-called “hard” Brexit scenario. Ratings agency Standard & Poor’s says Britain has the most to lose economically as it exports more to the E.U., when calculated as a proportion of the economy, than any other country. The risk, it says, is magnified by the fact that the services sector, such as banking, accounts for a significant chunk of those exports. And services are less likely to be covered in any immediate trade deal to retain privileged access to the massive E.U. market.

London at risk

Given its central role in the European financial sector, London’s fate is uncertain. When Britain leaves the E.U., British financial services companies would lose the automatic right to operate in all the other 27 E.U. states, a big handicap. A recent survey from consultancy EY found that the capital was losing ground as one of the three most attractive cities in Europe for business. The city’s global status, including its deep pool of skilled professionals like lawyers and accountants and the use of the English language, will help cushion the blow. “London is still top dog but it’s clearly losing ground,” said Moritz Kraemer, S&P’s chief rating officer.

Cost of living

The pound suffered the first and biggest hit from the Brexit vote, dropping nearly 20 cents from its pre-vote level of around $1.50 the day after the referendum. Since then, it’s fallen further to 31-year lows before making a modest recovery to trade at $1.27 a year on. While that fall has helped exporters, it’s proving costly to others by making imported goods, such as energy and food, more expensive. In the year to May, inflation rose to a four-year high 2.9%, way up on the 0.3% it was when Britain voted for Brexit. The pinch was felt immediately by British holidaymakers who will have suffered sticker shock upon buying an ouzo on the beach. Now the costs are being felt at home in Britain and retail sales are faltering as wages fail to keep up with prices.

Stocks energised

It may seem counter-intuitive but Britain’s main stock index, the FTSE 100, has actually hit a series of all-time highs since Brexit. That’s partly due to the export-boosting impact of the pound’s drop. Many international companies are listed on the FTSE 100, meaning that their earnings in dollars and other non-British currencies are worth more when translated back into pounds. Laith Khalaf, a senior analyst at Hargreaves Lansdown, highlighted the fact that “all of the top 10 performing stocks have significant international earnings” while more domestic-geared stocks, particularly those in retail, have suffered since the vote.