Emerging market confidence in the UK

Rising import prices have driven inflation to its highest for 5 years. The Bank of England expects inflation to start falling from the November Consumer Price Inflation of 3.1 %.

by Victor Cherubim-Dec 19, 2017

(December 19, 2017, London, Sri Lanka Guardian) With every New Year, most businesses in the UK start off with the premise that the uncertainty of the past year will usher in a new era of growth and development. But the response of UK businesses to the issues raised by Brexit, is that they are rearranging their geographical operations in reaction to the potential changes in trade or really an increase in protectionism.

Managing today is as much a concern for preparing for tomorrow. Researchers maintain that UK confidence is set to increase in 2018 as UK assets continue to be attractive to overseas buyers.

London property market

It is a smokescreen that there is a slump in the property market in London. Overseas
Property buyers are confidently snapping up London property as the domestic buyers have felt the uncertainty after the Brexit tug of war.

The fall in sterling in relation to the Euro and the dollar is seen by investors as a buying opportunity. When asked: “Will you delay buying in London because of Brexit, most European buyers, for that matter Chinese and Singaporean buyers seem to say: “Nothing in certain any more. We cannot put our life on hold until 2022”.

It appears there is increasing concern over the stability of the Euro, the difficulty of Chancellor Angela Merkel forming a coalition, the uncertainty of affairs in United States; the UK may be on the minds of the wealthy families in Europe.

Perhaps, the only certainty being that President Donald Trump, will not want to support another Republican like in Alabama, for fear of letting in more Democrats to control the Senate in election year 2018.

London Estate Agents feel confident that after the recent trade deal with the EU, some of the wealthy families of particularly France and Italy are looking to put their money in London. For many, Brexit has cooled down. Theresa May has at least for the time being stood up to the bureaucracy of Brussels and restored confidence. For many the future is approaching faster than anyone anticipated.

Economic confidence

Economic confidence.comes we are told, with an acknowledgement of increasing risks.

Corporate venture capital investments are used more and more by UK companies. “Currently 68% of UK CVC’s as compared with the global average of 49% were able to access new capabilities and technologies and a faster route to market.”

Corporate VC’s participated in $13 billion funding access in 798 deals in a single quarter of 2017. According to Industry Analytics the UK is able to track high growth areas, track competitor activity and predict private market trends for 2018.

Barclays Corporate states, “Venture Capital is so important to UK economy. It is vital in driving growth. It is one of the most important sources of funding in the UK economy.” This is happening in part according to Barclays because the technology on which innovation relies is now cheaper and more accessible. “It has never been less expensive to start a software company,” explains Will Bowmer, M.D. Barclays International, based in Silicon Valley.

Employment and unemployment

The number of people in work remains according to the FT close to record levels. “It may be providing a tentative sign that the country’s job boom may be losing momentum”.

The unemployment rate has tumbled over the past four years from 8% in 2013 to a 40 year low of 4.3 % in November 2017.But the pace of decline has slowed.

Rising Import prices

Rising import prices have driven inflation to its highest for 5 years. The Bank of England expects inflation to start falling from the November Consumer Price Inflation of 3.1 %.

It may be too early to state that in the aftermath of the current trade talks with the EU days ago, the expectation is that consumer confidence may bounce back.

UK is resilient

Managing today is as much a concern for preparing for tomorrow. With the above litany of confidence building measures, there is expectation that 2018 will be an economically strategic year for the United Kingdom. But the new reality in the market place is no options are off the table, similar to Brexit negotiations.