In summary:
- Threat of Euro break-up recedes for time being as ECB spends €22bn buying Italian and Spanish bonds.
- US pledge to hold interest rates at close to zero until 2013.
- Japan recovering faster than expected with growth in second quarter down by just 0.3%.
- Stock market valuations cheap in Europe and Japan.
Download the full Investment Prospects August 2011
Prospect Wealth Management brings the highest standards of professional investment management to the individual investor, charities and trusts.
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In summary:
- Western economies unexpectedly slow in May, though we do not anticipate another recession.
- Japanese economy now appears poised to rebound as stocks are rebuilt.
- Bonds have rallied strongly despite deteriorating inflation. We remain cautious on bonds.
- Equity markets are underpinned by attractive valuations and company earnings growth.
Download the full Investment Prospects June 2011
Prospect Wealth Management brings the highest standards of professional investment management to the individual investor, charities and trusts.
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Have you heard of the Monetary Policy Committee?
Didn’t think so.
In the Bank of England, the Monetary Policy Committee (MPC) are the group who set interest rates. The Committee is made up of nine members: the Governor (Mervyn King – he’s mentioned in the news quite a bit), four internal members, and four members from outside the bank. These last four are appointed directly by the Chancellor to balance things out.
The MPC meet every month to set the interest rate. In April, three members voted for an interest rate rise, of either 0.25% or 0.5%, but were overturned by the votes of the other six, who wanted the rates to remain the same.
This happens to be exactly the same result as the month before.
At Limetree we’re taking confidence not only from the rates remaining unchanged, but also from the fact that the voting pattern of the nine members has also stayed the same.
Low rates mean that our customers with variable rate, tracker and discount deal mortgages pay less each month. Long may they continue.
If you have any questions about how interest rates affect mortgage payments, feel free to get in touch. One way is to post your question on this site.
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In summary:
- Earthquake tragedy represents a buying opportunity for undervalued Japanese equities.
- Middle East turmoil not expected to lead to materially higher oil prices, but we remain vigilant.
- UK inflation of 4.4% justifies our continued caution on UK bonds.
- Global economic recovery remains in place though the pace of growth is insipid.
Download the full Investment Prospects March 2011
Prospect Wealth Management brings the highest standards of professional investment management to the individual investor, charities and trusts.
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In summary:
- Bank of England reassurances over inflation are worth little. We expect further rises in bond yields.
- Economic news remains supportive of global equities and we are adding to our international exposure.
- UK equities are expensive and company earnings expectations are faltering. We are underweight UK.
- The risks from China and the Middle East are receding – for the moment.
Download the full Investment Prospects Feb 2011
Prospect Wealth Management brings the highest standards of professional investment management to the individual investor, charities and trusts.
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