Brexit watch

Euro_flag_yellow_lowOk, there is a lot happening at the moment. Today has been quite significant in terms of economic impacts of Brexit.

The Governor of the Bank of England, who seems to be our de facto Prime Minister running the country in the absence of anyone else, has reported that the economy has started to respond to Brexit.

The low value of the Pound Sterling – the UK currency – makes imports expensive. Prices will go up and hence inflation. Inflation coupled with low growth = stagflation. Not good.

Whilst the FTSE 100 index has increased in value, this can be explained by the fact that most of these firms are international and trade globally. The more pertinent 250 index, which tracks the value of more domestic-focused firms, is much less healthy.

Three property funds have suspended trading on UK property – basically, too many investors wanting to redeeem investments in anticipation of a property crash (see above link).

Advertisements

No comments yet

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: