It’s official, Prime Minister Theresa May will invoke Article 50 on Wednesday 29th March and begin Britain’s exit from the European Union. For many people, this feels like a big moment in the Brexit process, whether they agree with the results of the referendum or not. However, when it comes to your finances, this is not a time to panic. At Moyes Investments, we’re here to answer your financial questions and allay any fears.
Should I be worried about the state of the pound?
There’s no denying that the pound is weak right now, but it’s worth remembering that our currency fluctuates on a daily basis and it could go back up again. Inevitably, the result of the referendum saw the pound drop significantly as the markets had a kneejerk response to the news, and there was a dip again as Prime Minister May named her Article 50 date. A weak pound means the price of imports, holidays, petrol and other supplies will go up. But its good news for exporters as it will reduce their prices and these benefits could be felt by the rest of the population as they trickle down. All the uncertainty makes it hard to predict, but you can be sure that Moyes Investments are monitoring the rise and fall of the funds in our portfolios closely.
Is there any upside of having a weak pound?
Yes, leaving the EU means that the UK can go out into the global market unhampered by their trading regulations. Those businesses competing internationally on services are going to be more competitive on price, and the more work they get, the better it is for our economy. Growth has happened globally and in the UK, even when it was predicted to fall dramatically, so there is a proved resilience from our economy and businesses. We can only hope this trend continues as the Brexit process begins.
Will I see an immediate difference the day Article 50 is triggered?
No, you won’t. Britain’s exit from the EU will take place over a two-year negotiation process, and change won’t be swift. In fact, it may be decades before the full impact of Brexit is felt and this is not a time to overreact. The main benefit of the official leaving process is that there will be greater clarity on what deals Britain can expect from the countries still in the European Union. No EU member has done this before, so it’s new territory for all concerned. As the new deals on trade and immigration are established, the markets can respond in an informed manner.
*Are my investments going to be safe?
Despite the market dip following June 23rd, investors have seen a steady and pleasing return on investments over the past year. UK assets have turned out to be more resilient than people thought, and the low pound meant that investors were buying up British stocks and ploughing money into investment funds here because of the lower costs. It’s vital to have a diverse portfolio so that you aren’t putting all your eggs in one basket, and any good investment manager should make sure that happens.
At Moyes Investments, we carefully monitor the markets and ensure all our clients investments are managed in the right portfolios in line with their attitude to risk.
You can rest assured that we are committed and focussed on producing results for our clients and if you’d like to talk through the effect of Brexit on your finances or would like us to help you with your portfolio, please get in touch on 01638 429975 or email [email protected]
*It may be difficult to sell or realise the investment, or obtain information about its value, or the extent of the risks to which it is exposed. Property is a specialist sector it can be volatile in adverse market conditions, there could be delays in realising the investment. Property valuation is a matter of judgement by an independent value therefore it is generally a matter of opinion rather than fact. The value of property investments and income from them can go down as well as up and investors may not get back the amount original invested. Past performance is not a guide to future performance and should not be used to assess the risk associated with the investment