Where Now For Investors?

The announcement of the result of the UK’s EU Referendum on Friday 24 June came as a  shock to many people at home and abroad.  Within hours David Cameron had announced his resignation. The pound fell to its lowest level against the dollar for over 30 years. Stock markets around the world lost ground on the news. The UK was stripped of its triple A credit rating.

By 16 July the new Prime Minister, Theresa May, made it clear that “Brexit means Brexit and we will make a success of it.”

Business people walking

Advice To Investors

From a consumer perspective there is some good news around. Incomes are rising and employment is at an all-time high. House prices have yet to fall far from their  prereferendum levels.

While stocks and shares initially fell sharply on the news, both the FTSE 100 and FTSE 250 have recovered ground. The fall in the value of the pound is good news for exporters as their products become cheaper for foreign buyers; the devaluation acting as an enticing discount.

The Bank of England’s Monetary Policy Committee has introduced a rate cut to 0.25% and has indicated that further stimulus measures could continue to be applied if necessary to steady the economy. The new Chancellor, Philip Hammond, has made it clear that many austerity measures will be relaxed to stimulate the economy. All eyes will be on the Autumn Statement.

So, all in all, many commentators conclude that the impact so far has been rather less pronounced than some had predicted.

There will no doubt continue to be good and bad economic news in the coming months as events unfold. In the short term, it’s widely accepted that there will be shocks in currency, shares and property markets ahead. But for now, there is no reason to panic, and every reason to adopt a ‘wait and see’ stance.

The value of investments can go down as well as up and you may not get back the full amount you invested.  The past is not a guide to future performance and past performance may not necessarily be repeated.

It is important to take professional advice before making any decision relating to your personal finances. Information within this blog is based on our current understanding of taxation and can be subject to change in future. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK; please ask for details. We cannot assume legal liability for any errors or omissions it might contain. Levels and bases of, and reliefs from taxation, are those currently applying or proposed and are subject to change; their value depends on the individual circumstances of the investor. The value of investments can go down as well as up and you may not get back the full amount you invested.

The past is not a guide to future performance and past performance may not necessarily be repeated. If you withdraw from an investment in the early years, you may not get back the full amount you invested. Changes in the rates of exchange may have an adverse effect on the value or price of an investment in sterling terms if it is denominated in a foreign currency.

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