UK Markets Outlook Policy to anchor gilt yields and to buoy equities As a protracted economic recovery from the coronavirus crisis will force the Bank of England to keep interest rates close to zero and further expand its quantitative easing programme, gilt yields will... 14th May 2020 · 12 mins read
UK Markets Outlook Markets may be caught out on interest rates We think the financial markets will be caught out this year by a decent acceleration in the quarterly rate of GDP growth preventing interest rates from being cut below 0.75%. And if we are right to... 12th February 2020 · 12 mins read
UK Markets Outlook Upside risks of the election outweigh downside risks As the markets have not fully priced in the Conservatives winning the general election on 12th December and securing a Brexit deal, if that were to happen we suspect the pound would climb from $1.28... 13th November 2019 · 14 mins read
UK Markets Outlook Global jitters aggravated by no deal fears The global shift away from risky assets and towards safer ones that seems to be underway will either be exacerbated by a no deal Brexit on 31st October or cushioned by a deal or a delay. Although a... 12th August 2019 · 14 mins read
UK Markets Outlook Buffeted by global forces For the remainder of this year UK assets will probably be buffeted by global trends, resulting in UK equity prices falling by about 10%, 10-year gilt yields declining from 1.05% to around 1.00% and... 15th May 2019 · 1 min read
UK Markets Outlook Scope to stand out from the crowd Should a Brexit deal be reached within the next few months, the UK’s financial markets will probably buck the global trend with money market rates, Gilt yields and the pound all rising by more than is... 12th February 2019 · 1 min read
UK Markets Outlook A fork in the road The recent political chaos in Westminster means that the chances of the UK leaving the EU without a deal have risen, in our view, to about 50/50. In a no deal Brexit scenario, we would expect sterling... 20th November 2018 · 1 min read
UK Markets Outlook Brexit uncertainty to keep MPC in state of inertia Brexit uncertainty has driven sterling lower in recent months and is likely to mean that the Monetary Policy Committee (MPC) keeps interest rates on hold for some time. But provided a Brexit deal is... 13th September 2018 · 1 min read
UK Markets Outlook Rebound in growth to lead to higher interest rates The bout of softer-than-expected inflation and activity data which caused the MPC to step back from hiking Bank Rate in May is certainly reason for caution. But like the MPC, we think that temporary... 17th May 2018 · 1 min read
UK Markets Outlook Markets still underestimating pace of rate hikes Financial markets are now pricing in a 60% probability of the Monetary Policy Committee (MPC) raising Bank Rate by a further 25bps in May, up from around 40% at the start of the year. But we still... 26th February 2018 · 1 min read
UK Markets Outlook Markets take rate hike in their stride The MPC succeeded in striking a dovish tone as it raised Bank Rate for the first time in a decade. While the Committee didn’t frame the hike as “one and done”, it did convince investors not to expect... 14th November 2017 · 1 min read
UK Markets Outlook Pessimism about sterling’s prospects overdone In contrast to some forecasters who have suggested that the pound could reach parity with the euro before the end of the year, we expect sterling to reverse some of its recent losses against the euro... 6th September 2017 · 1 min read
UK Markets Outlook Equities will struggle to make further headway Stock markets have shrugged off the uncertainty created by Brexit, with the FTSE 100 rising by 19% since the EU referendum last year. However, the key supports of the rally have now faded. First, the... 2nd June 2017 · 1 min read
UK Markets Outlook Recent fall in gilt yields could prove short lived We think that the recent fall in gilt yields – which appears to partly reflect lower Bank Rate expectations – has been overdone. While economic data has taken a slight turn for the worse, we remain... 6th March 2017 · 1 min read
UK Markets Outlook Gilt yields won’t rise much further The recent rise in gilt yields has fully reversed the falls seen after the EU referendum. Although they have followed Treasury yields up following Trump’s election victory, this is not the whole story... 22nd November 2016 · 1 min read
UK Markets Outlook Gilt yields set to remain very low for a long while yet The prospect of a further prolonged period of ultra-loose monetary policy suggests that government bond yields are set to remain markedly low for a long time yet. Admittedly, we think Treasury yields... 22nd August 2016 · 1 min read
