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Financial Markets Commentary

June 2023

  • The global rate of Inflation has fallen at last but not by much, not enough to pause rate rises in the UK but maybe enough to pause rate rises in the US which is a starting point at least. It’s felt by some fund managers that the UK investment market is undervalued and cheap compared with the rest of the world.
  • As reported in the Financial Times at the weekend, international investor confidence in the UK has been bruised by things like the Brexit vote, imprudence and too many prime ministers and chancellors in a short space of time. Because of this, gilt yields have jumped back to the levels reached just after the mini budget. I mention this because even with the debt ceiling negotiations in the US, their sovereign debt is still sought after unlike ours.
  • The inflation story is starting to pivot and interestingly there is no inflation in China.
  • As implied in recent commentary, there is a slow down in the global economy on the way. A lot of leading indicators have been flashing this up, one is the spread between three month and ten-year treasury rates. It is for this reason it’s important we hold fixed interest investments and equity investments i.e., the fixed interest market is factoring in this slowdown and the equity market is not.
  • We are all acutely aware of the continuing war in Ukraine and the tensions rising over an invasion of Taiwan. There is no good news about the Russian Invasion of Ukraine, but we have not run out of gas and energy prices are stabilising. The consensus opinion is that an invasion of Taiwan by China is unlikely, although I remember that being said about Russia invading Ukraine.
  • At annual review FFP continue to adjust client portfolios that consider the changes to the global economy as referred to above.

Please note that:

  • This information in isolation is not financial advice.
  • Past Performance of investments is not to be relied on and the value and the income from investments can go up as well as down.
  • It is advisable to regularly review your investments.

Gianni Campopiano
Managing Director & Chartered Financial Planner

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