EY Item Club have warned that the UK is set for three years of lagging growth.

Previously, The EY Item Club forecast GDP growth of 1.3% for 2018, and 1.5% in 2019.

This marked a downward revision from 1.4% and 1.6% projected in its previous outlook three months ago.

However, the economic forecasting company said that should no Brexit deal be reached, this would prove “significantly weaker”.

“The EY Item Club suspects that the Bank of England will want to see sustained evidence that the UK economy is holding up relatively well after Brexit occurs in late March, before hiking interest rates,” the findings stated.

EY chief economist Mark Gregory also commented: “The UK economy is going to experience a period of low economic growth for at least the next three years, and businesses need to recognise this and adjust accordingly.”

“They should also consider a sharp downside to the economy in the event of a no-deal Brexit and make preparations for such a scenario.”

“Even if the Brexit process goes smoothly, the cyclical risks to the UK economy mean this would still be a worthwhile exercise. Now is the time to start to think about the future shape of any UK business after 2020,” Gregory warned.

The downbeat EY Item Club forecast comes after Brexit talks over the weekend hit a standstill over the Northern Ireland border.

With the deadline for withdrawal fast approaching and no sign of a discernible trade deal on the horizon, a no-deal scenario is becoming increasingly likely.

Various companies have warned the government that a no-deal would severely impact business in the UK.

Just recently, the chief executive of the Royal Bank of Scotland (LON:RBS) said that a lack of deal could lead the UK into another recession.

Prime Minister Theresa May is set to update the commons on Brexit negotiations later this afternoon.