Humphrey Percy Chairman and FounderMon 24 Apr 2023
UK Interest Rates
Previously expected to peak at 4.5%, UK interest rates are now (mostly) expected to peak at 5% in the summer. Worth examining what the Bank of England forecast the annual inflation rate to be in February 2022 for 1 year forward in February 2023: 5.2%.
As we know it is almost 5% above that at 10.1%. Interestingly the average economists‘ panel prediction is for inflation to average 6.5% in 2023 before falling to average 2.4% in 2024 and then slip back beneath the 2% BoE target level in 2025. Sounds cosy.
That’s because it is: too cosy. Let’s take 2023: to average 6.5% for the full year, arithmetically to achieve that level after 2 months at 10%+, the rest of the year has to average 5.8% per month. Some might conclude that the mantra of Nanny Knows Best from the worlds’ central banks is largely discredited after their slowness to react to the long running easy money conditions and their consequences. The Bank of England, it is to be hoped, is going to be different from its peers, but it is hard to see as at nearly the end of April.
Lord Camoys R.I.P.
On Friday afternoon colleagues, competitors, friends and family crowded into Westminster Cathedral in London to honour and remember one of the truly significant figures of UK Finance and public life of the past 50 years. I write crowded since the cathedral was packed which says just what an impact Tom Camoys or TC had on people in his 83-year life and in whose memory we were treated to a truly magnificent memorial of music, readings and tributes to the man whose financial legacy was to to have created the only surviving British global investment bank 37 years after Big Bang: Barclays Capital.
The economic titan that is Germany is today when it comes to seamless air travel within the country, grounded. All departures from Berlin have been cancelled and airports at Cologne, Dusseldorf, Hamburg and Stuttgart are also shut today due to a strike by the union Verdi over pay awards versus cost of living. EUR/USD 1.0980.
What a Wonderful World
This day in 1968, Louis Armstrong scored a Number One hit with this magnificent song. Aged 66 at the time it made him the oldest person to score a UK Number One and the song rightly so, is as poignant now as it was 55 years ago.
I see trees of green Red roses too I see them bloom For me and you And I think to myself What a wonderful world
I see skies of blue And clouds of white The bright blessed day The dark sacred night And I think to myself What a wonderful world
The colors of the rainbow So pretty in the sky Are also on the faces Of people going by I see friends shaking hands Saying how do you do They’re really saying I love you
I hear babies cry I watch them grow They’ll learn much more Than I’ll ever know And I think to myself What a wonderful world Yes, I think to myself What a wonderful world Ooh, yes
Discussion and Analysis by Humphrey Percy, Chairman and Founder
British Pound There really was something for everyone in Bank of England Governor Bailey’s comments yesterday. Firstly he said that the BoE was comfortable with the market’s view of the decline in UK interest rates -meaning one presumes both on extent and timing. Then he followed it up by saying that the UK labour market […]
34 Days That is the average time it takes between putting a UK home on the market and agreeing a sale. In London it takes 40 days which is the longest in the UK while at the other end of the time scale in Scotland the average is a mere 20 days. GBP/USD 1.2600. UK Retail […]
The penny drops With UK GDP growth data released at 7am today, many commentators had looked ahead to today as a day of reckoning for the UK and its economy. With Q3 2023 already having published a negative growth rate, if contraction was confirmed in the UK for Q4 in this morning’s data then it […]