Pound remains a good medium to long term bet
In our previous blog, we touched upon the UK being a safe haven in an unstable geopolitical climate, with a fading sense of assurance amongst the world’s democracies. But the economic case for a move to the UK remains compelling too with the recent strengthening of the pound complementing the news that the UK is strongly rumoured to be destined for a soft brexit.
Ian McCafferty, a member of the Bank of England’s Monetary policy committee, recently stated that wage growth may be stronger than ever, ultimately adding to the inflation pressure within the BoE’s target. The UK shouldn’t fear rising inflation rates due to the pound sustaining a more secure position among the world’s currencies off the back of interest rates possibly set to rise twice this year.
McCafferty’s bullish tone was offset by Bank of England Governor Mark Carney who commented last Wednesday evening that economic data in the next few weeks will be key to whether or not the Bank of England will make their move and raise interest rates on May 10th.