Since joining the European Economic Community in January 1973, which later became the European Union (EU), the UK has had an uneasy relationship with the project.
Its commitment has been tested several times over the years. More recently, the marriage has hit the rocks and may be about to break down completely.
Residency from A to Z - Eurofinesco explores the concept of Residency, and how it touches the lives of residents in Portugal.
A change of fortunes this week with the British pound gaining ground against the single currency as the week progressed.
Bank of England Governor Mark Carney was keen to share his view on the UK’s current position and future prospects during his Economic Affairs Committee speech. He made strong reference to the negative economic implications should the outcome of the UK’s EU referendum vote be Brexit.
Carney indicated that the Bank of England still has room for conventional monetary measures, which may be called upon should UK economic conditions flounder after a Brexit outcome, although there is no appetite at all to dip into negative rates territory within the Bank of England’s Monetary Policy Committee. So the message is clear, interest rates in the UK could be tweaked below the current 0.5% level. No doubt opinion poll releases in the run up to the poll date of the 23rd of June will hold sway for sterling.
The European single currency started the week well against both the US dollar and the British pound, although the recent high’s soon gave way to profit taking and a rather strong reversal certainly against sterling.
Monday saw the pound trade at its lowest level against the Euro since June 2014 at €1.2350 as concerns that the UK economy is slowing and will continue to do so until the outcome of the UK EU referendum vote is known.
June 23rd seems like a long way away, however with the opinion polls now suggesting the leave vs remain in campaigns are now on equal footing, the uncertainty has left Sterling with few friends.
The euro continues to trade higher against both the US dollar and the British pound, despite the obvious weakness of the Eurozone economy and the very accommodative nature of the European Central Bank’s ongoing stimulus measures, which are in distinct contrast to the action of the Bank of England and the US Federal Reserve.
US interest rates will no doubt rise again at some point this year as qualified by this week’s release of the most recent FOMC minutes. The Federal Open market Committee did discuss the possibility of raising US interest rates again in April, however for the moment, with contradictory feeling running high amongst the USA Federal Reserve voting members, it seems that FED chairwoman Janet Yellen’s recent rhetoric has reaffirmed that US policy will see rates tweaked just two more time this year at most, rather than four times that were partially accounted for by the markets. Diverging interest rate policy should over time offer good reason to favour the US dollar over the Euro, but for now this is not necessarily the case.
The European single currency has maintained its recent strong tone having gained further ground against both the US dollar and British pound over the last week.
Weak European inflation currently running at -0.1 during the month of March was ignored by the markets, possibly due to the fact that it was marginally higher than the previous month. Certain aspects of Eurozone inflation are now beginning to rise, although still miles away from where the ECB would like inflation to be.
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Investment markets have had a volatile first quarter, the FTSE 100 seems to be finding support around the 6000 level. However, what is going to happen over the remaining nine months of this year, especially with Brexit and the looming US Presidential elections. We have attached the quarter end commentary which explains what has happened this year, but more importantly outlines Rathbones' thoughts as to what will be in store for us for the rest of the year.
With the exception of the Sultanates of Brunai and Quatar and the principality of Monaco all governements in the world have one and the same primary drive: stealing as much money as possible from the pockets of their citizens.
However as they like to be seen as "honest people" (think of Mrs Albuquerque) they use a very euphemistic expression for that: they call it "tax collecting".
