chart580A recent poll by news agency Reuters has hinted that the UK economy could contract by 0.1% in each of the next two quarters, which would be classified as a recession and could prompt the Bank of England to shave a further fraction off of the Base Rate later in the year.
A fall in business investment is largely blamed for the forecast, with many firms holding off investment until more clarity over the Government’s Brexit time-table is outlined. Chancellor of the Exchequer, Philip Hammond, intends to review government tax and spending policy in a budget update later this year, with some economists urging him to launch a programme of debt-finance investment projects to support the economy.
But, despite the mixed forecasts, the FTSE 100 stands at a 14-month high, with major investors clearly remaining confident of the longer-term strength of the equities markets, which are historically a proven and profitable investment strategy even in times of economic uncertainty.
If you would like to talk to The Financial Planning Group about your investment strategy, please call 0800 731 7614 and we will be happy to arrange a meeting at our offices in the heart of Teddington.
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