The only certainty from the Brexit vote fallout appears to be a large deal of uncertainty ahead for New Zealand markets and commodities, according to analysts and economists.
Global markets were estimated to have shed $US2trillion ($NZ2.8trillion) in market capitalisation of companies on Friday, while the NZX shed about $2.4billion in value.
Berl's chief economist Dr Ganesh Nana said that heading into last week's Brexit vote were underlying weakness in Europe alongside geopolitical upheaval and a "peculiarly potentially disruptive'' US presidential election campaign.
"So buckle in for the coming months. They will be neither smooth, nor enjoyable. We're in for a rough period,'' he said in a statement yesterday.
Craigs Investment partners broker Peter McIntyre said he expected volatility across the NZX for about the next fortnight, in both selling and buying, with some seeing a price plunge as an opportunity to buy.
Much of Friday's global selling was investors exiting British companies, or companies elsewhere with exposure to revenues from the UK, plus selling of the pound, to more than 30-year lows.
"The market will take a couple a couple of weeks to settle down, with large movements, both up and down,'' he predicted.
"Key'' post-vote issues for Mr McIntyre were whether a "contagion'' would spread where impetus built for other countries to exit the EU, and increasing calls over the past weekend for a second British referendum.
Dr Nana highlighted that the prospects of the Chinese economy "remain the elephant in the room'', given the response of international financial flows to the prospect of less than 5% annual growth in China, which "remains a worrisome unknown''.
"With such uncertainty, vulnerability and fragility, the potential impact of an upheaval such as the United Kingdom leaving the EU cannot be understated,'' Dr Nana said.
The immediate response to the Brexit decision saw a reversal of some gains the New Zealand dollar had made, as funds subsequently fled to the conventional safe havens of gold bullion and the US greenback.
In the run-up to the vote the New Zealand dollar rose close to, or above 12-month highs, against the US dollar at about US71c, the Australian dollar at A95c, the UK pound at 49p, and the euro at €0.63.
"There is no way New Zealand will escape the short and longer-term fallout from such global disruption,'' Dr Nana said.
He said recent OECD and International Monetary Fund downward revisions to global growth forecasts and the now relatively attractive New Zealand interest rates, the attractiveness of the New Zealand dollar could return after the immediate vote response.‘‘That could further restrain external sector income and, so, investment in that sector,'' Dr Nana said.
Westpac's chief executive, Dominick Stephens, said it was difficult to say how how the Brexit would affect New Zealand exporters.
"Suggestions that the UK will now trade more freely with New Zealand seem overconfident and premature to us,'' Mr Stephens said, as the final votes were being counted on Friday.
He noted existing trade agreements would remain in place for "some time'' with the UK and EU, while they negotiated the exit, which is expected to take up to two years.
BusinessNZ's executive director Catherine Beard said the Brexit vote would have an impact on New Zealand's trade arrangements, if new trade deals needed to be struck between the EU and Britain.
"For example, New Zealand meat exports to the EU and UK are linked, and those deals may need to be unpicked and renegotiated. Unfortunately, this will create uncertainty,'' she said in a statement.
However, the Brexit vote had to be seen in the context of the larger moves in exports over recent years, in that New Zealand was increasingly trading with Asia and Australia rather than the EU and Britain.
"Thirteen percent of our food exports go to Europe while 50% [goes to] to Asia.
"New Zealand's larger export trend is from feeding the West to feeding the East, and this is likely to continue,'' Mrs Beard said.
