Economy update for July and August
22nd August 2018 | 12:00am
22nd August 2018 | 12:00am
Here is the latest economy report from Roger Martin-Fagg. Roger is one of the best economic forecasters in the UK and has accurately predicted a number of events over the years. This month he takes a look at some of his recent predictions and looks at what has actually occurred in this economically tumultuous time.
Much of Roger’s predictions have focused around the impact of Brexit on the UK markets, but it seems that Brexit is currently playing second fiddle to wider global issues – such as the Trump effect. You can read the full update on the Property Academy website.
In a previous set of predictions Martin-Fagg explained that we were near the top of the cycle, however this month it is looking like a combination of global factors could create, what he calls ‘a perfect storm’. Factors such as the USA sanctions on Iran and US tax cuts causing oil prices to rise and unemployment to grow respectively.
President Trump’s regular threat of trade wars has also had an effect on some EU companies stock prices – threats of sanctions on EU cars importing to the US resulted in BMW and M-B taking a hit on their stock prices.
With no real progress in the negotiations, the expectation of a ‘no deal’ is actually having more of an impact on the markets than a ‘no deal’ final outcome would - with corporations taking increasingly more cautious approaches to the way they do business. Banks are also becoming more stringent with their lending criteria which could mean that recession is around the corner (in the next 18 months).
Many households are living on less than £30K a year after tax and since the Brexit vote there has been no significant improvement in the incomes of the majority of the UK.
So, unfortunately it doesn’t make for positive reading, however, with many people away for their summer break, Martin-Fagg concedes that in September people will return to their desks fresh and ready to think more strategically about the threat of a hard Brexit and Trump trade wars. We all hope that he is wrong about all of the former and right about the latter.
Be that as it may, you shouldn’t be deterred from buying or selling your home. Remember that while we are in rather uncertain times, if you sell and buy in the same market you are theoretically no worse off; plus the cost of borrowing is relatively cheap with 2 year fixed rates of around 1.49% and 5 year rates around 1.89%.
If you would like to speak to someone about your options make sure you get in touch with your award winning estate agent in Beaconsfield and surrounding areas on 01494 680018 or email us. You can also follow us on Facebook, Twitter, Instagram and LinkedIn.