It is hard to believe but just under eight weeks ago, Kwasi Kwarteng, then UK chancellor, announced his ‘growth plan’ comprising the Truss government’s energy price guarantee and large tax cuts. At the time, I described the announcement as radical
We continue to operate in extraordinary times. Just as we are emerging to some sense of normality after the pandemic, the world continues to face instability. In the UK, we are experiencing a cost of living crisis and rising inflation.
Liz Truss’s defenestration last week exposed deep divisions over economic policy within the UK government and Conservative party. In winning the general election in 2019, Boris Johnson concealed these divisions by promising both higher public spending to his new voters
The world of Liability Driven Investment (LDI) strategies, one where “boring” is generally viewed as a strong selling point, became headline news in the UK last month. The much-awaited shift away from a low rate environment – generally a good
Liz Truss’s defenestration last week exposed deep divisions over economic policy within the UK government and Conservative party. In winning the general election in 2019, Boris Johnson concealed these divisions by promising both higher public spending to his new voters
Het risico op stagflatie maakt het leven van overheden en centrale banken veel moeilijker en het toegenomen risico op beleidsfouten zal de volatiliteit op de obligatiemarkten waarschijnlijk hoog houden. Maar er ontstaan ook beleggingskansen. Het VK ligt de laatste tijd
Recent weeks have seen major changes in UK economic policy with the arrival of Liz Truss as Prime Minister and Kwasi Kwarteng as chancellor, sparking major controversy and a selloff across gilts and sterling. Taking a step back, it is
After a 24% year-to-date decline in the S&P 500, we ask what could make us turn positive on equities. A 30% further decline would help but short of that, some combination of the start of recession, VIX above 40 and
Mass market residential housing is in structural undersupply. As such, it is a defensive sector. It is not immune to supply chain or inflation risks. The sector has seen inflation in construction costs. To date, these costs have been absorbed
Households are about to experience the biggest hit to disposable income in a long time. Rising inflation, continued supply chain constraints and now the Russia-Ukraine war have piled on seemingly all at once. The swelling piggybanks from stashing away cash
A key channel of contagion to fixed income markets outside of Russia/Ukraine is likely to be through commodity prices. Russia is the largest exporter of natural gas and the second-largest exporter of crude oil and petroleum products. The US has
There’s no doubt the war in Ukraine has clouded the economic outlook. Commodity prices have soared following Russia’s invasion putting more pressure on households’ real disposable income, and dampening growth prospects. But there’s real momentum behind the UK recovery going
Hydrogen is the most abundant molecule in the universe, found primarily locked in water and hydrocarbons. Its qualities have been known for a long time, and it has been used for more than 100 years as an industrial chemical. While
2021 was a standout year for UK real estate, which delivered annualised total returns of 14.7% to the end of October, as robust income returns were complemented by the return of capital growth. This represents the highest level of annualised
Uncertainty surrounding the effect of the end of the UK furlough scheme on unemployment had been top of the Bank of England’s (BoE) list of economic concerns, but last week’s jobs data provided reasons to be optimistic on this front.
This November sees the UK play host to COP26 – the 26th Conference of Parties – where global leaders from almost 200 nations will come together and discuss climate objectives and, more importantly, revisit the commitments made as part of
A broad spectrum of central banks fear climate change could spark the next financial crisis. For this reason, regulators in Europe and the UK are already beginning to scrutinise banks’ resilience to climate change – looking into both the likely
Flash Update: Q2 2021 proved to be another good quarter for banks, beating market expectations once again. These beats were generally driven by better revenues in capital market divisions, especially equity trading and M&A, whilst loan loss provisions continued to
Property investors are examining the emerging “new normal” as input into capital deployment plans for the months ahead. If history is a guide, the UK will capture a lion’s share of planned investment because its defining features remain extremely attractive
In Credit: Inflation had long been expected to rise – and rise it has! Data released from the US and UK last week showed a jump in prices that exceeded (increased) expectations by some margin. Starting in the US, Consumer
In recent years, both the United Kingdom and the Netherlands have introduced significant changes to the way defined contribution (DC) pensions can be accessed. This article examines the changes and reflects on how each country’s DC savers have responded. We
As recovery from the Covid-19 recession appears to be gaining traction, prospects for rebounding economic growth and employment across UK regions and cities is now worth contemplating. Initially, the recovery should revive activity and jobs in the sectors that were
The UK government green financing programme ('the programme') is a green gilt (bond) issuance programme, alongside a world-first green retail savings bond via NS&I – the UK government’s retail savings arm. In addition to the core purpose of financing sustainable
The rapid roll-out of vaccinations across the US and the UK, with Europe catching up, pushed developed market PMIs once again to record highs in May. Business activity and new orders have accelerated across both manufacturing and services sectors, business
Asset Allocation Monthly – June 2021: Investor attention is turning to where economic growth will accelerate next as vaccine rollouts allow more and more economies to reopen. The current leaders, the US and UK, will soon pass the baton to
In credit: We saw some key economic data last week, in what felt like a seasonal lull for a number of European countries given the late May bank holiday and a week of school holidays. In the UK, sterling hit
We have remarked previously on the similarities between asset management and football (Investing? It’s a funny old game, July 2018), and as Covid-19 swept the globe during the last 12 months, our thoughts once again turned to these parallels. At
Chancellor Rishi Sunak delivered only his second Budget, but the first after the full realisation of the impact of the pandemic on the UK economy. Amidst much speculation that he would tighten fiscal policy to address a large deficit, the Chancellor delivered a dynamic …
Markets continued to focus on hopes for a recovery rather than risks. The epidemic seems to be slowing in the United States and in United Kingdom. It appears to be under control in Europe.
2021 began with renewed bouts of volatility with a tug of war emerging between concerns over slow vaccine rollouts especially on the continent and delays in US fiscal support against positive earnings trends.
Less interest, in negative interest rates. Markets at a glance – 8 February 2021 It was a game of two halves for macro markets last week. Italy won in the end, with the UK coming last. For Italian bonds, spreads
The EU-UK trade deal leaves open questions But the exclusion of some areas brings opportunity for reform. The wait is finally over. Four‑and‑a‑half years after the Brexit referendum, the UK has exited the European Union’s single market and customs union,
Webinar – Resurrection of a deplorable asset class! Join us on Tuesday, 9 February at 13:30 GMT / 14:30 CET as Richard Colwell (Head of UK Equities) and James Thorne present their views on the current market environment for UK Equities. Also joining will be Sonal Sagar who will look at
Recent news about the COVID-19 pandemic has been worrying, with more contagious strains of the virus spreading internationally, rising contamination rates, and healthcare systems on the verge of being overwhelmed, particularly in the UK and the US.
UK Defined Benefit Pension Schemes Should Prepare for Negative Interest Rates T. Rowe Price Insights on Fixed Income Negative interest rates are likely coming to the UK, but you would not know that judging from the markets. Although rates are
As widely expected, the core of the deal is a zero-tariff/zero-quota free trade agreement for goods. This means that EU-UK trade will be much less affected than if the UK had ‘crashed out’ without a deal, to be governed solely
The role of gilts in portfolios could be impacted. Negative interest rates are likely coming to the UK, but you would not know that judging from the markets. Although rates are widely expected to fall, implied policy rates show that the
Webinar – Wat brengt 2021? 2020 gaat de boeken in als een jaar met vele extreme gebeurtenissen. Het virus zorgde voor een ongekende economische krimp, enorme steunpakketten en volatiele financiële markten. Wat staat ons te wachten in 2021? Kan de
Market Flash Falling temperatures have exacerbated the global sanitary situation. In Europe, Germany and the UK reinforced restrictions. Cases have also started rising again in Asia, a worry for Japan and South Korea which had managed to control the first
We explore this week the possible “exit strategy” from the ongoing extraordinary fiscal and monetary stimulus. Drawing on Olivier Blanchard’ recent research, we argue that the current EU fiscal surveillance framework may … Key points The current EU fiscal surveillance
After some U-turns from the US President and although discussions are continuing, no deal has been found on a new fiscal stimulus package. The Fed has been very explicit on the necessity of a timely and comprehensive additional budgetary push
UK equities in a ‘doom-loop’ We have seen something of a recovery in global markets since the pandemic struck, but this is very much the first pulse1. This was always going to be significant, given the magnitude and speed of
Research & Strategy Insights The sense of disappointment on the state of the recovery is particularly acute in Europe, where the traditional macro indicators, such as the PMIs or the forward-looking components of the national surveys, are already pointing to
Like a long-running TV series, the latest season of the Brexit saga brings new drama and tension. Like all good drama, there are twists and turns in the plot, unclear motivations of key characters, complexity and new set-piece showdowns. Last
Summary for the week ending on Friday, 30 July Last week’s corporate earnings reports demonstrated that some major companies are benefiting from the pandemic’s impact on consumer patterns. This was on clear display Thursday evening, when Facebook, Amazon.com, Apple and
LCP pensions de-risking report: Buy-ins, buy-outs and longevity swaps 2019 was a remarkable year with buy-in and buy-out volumes in the UK hitting a record £43.8bn. This followed on the heels of 2018 which itself was an exceptional year reaching
Regulators in the UK and Europe have introduced a de-facto ban on bank dividends. The rationale for this is that banks provide a critical part of the monetary transmission mechanism. Regulators want to ensure that banks don’t compromise their ability
Global Matters Weekly You tend not to hear too much from the city of Leicester here in the UK but it has played host to a number of historical events over the years and I’m proud to say I lived
Research Blast It feels like a different era whereby every conversation around the UK commercial real estate market evolved around the topic of Brexit. Following the outbreak of COVID-19 in Europe, the issue was hardly mentioned. But as transactions in
Stocks had a poor start to last week, as concerns over the worsening of the pandemic in several states as well as a new outbreak in Beijing seemed to continue weighing on sentiment. The market then rebounded late Monday following
