As rehearsed many times on these pages, the next move onwards and upwards for your investments depends largely on the decisions of various bankers and economists in what would once have been ‘smoke-filled rooms’. Much more so than on the more deadly stuff happening in other places, as it’s interest rates and their future direction which will have the biggest impact. If they go down or there’s a glimmer of an indication that they may, money will move out of ‘safer’ stuff like government bonds, and into shares. Companies which need to borrow or already have big borrowings will have a brighter future and be more likely to make profits, will be attractive to investors and their share prices will rise. And it will be a signal of optimism that inflation has been licked into shape and ‘growth’ is returning. If all that happens before our and other elections, those in power can try and take the glory. Good luck with that, Rishi. And, please, good luck with that, Joe Biden.
“UK slips into recession as economy contracts 0.1% in December”
This week’s big economic and bad election news is that we are, or certainly have been, officially in a recession. You may not have thought you were, or you may have thought you have been for some time, as we and its effects are all different.