UK Autumn Statement reaction
Schroders economic and investment experts respond to the UK Government's Autumn Statement.
Azad Zangana, Senior European Economist and Strategist, Schroders, said:
“There is clearly a focus on trying to boost investment across the economy, with the Chancellor having unveiled a number of tax breaks for both households and businesses.
“Our UK economic forecasts differ from the OBR as we are still expecting the UK to have a recession early next year amid continued weak growth. Furthermore, while inflation has come down to 4.6% this level remains far too high.
“This is why a significant amount of focus today has been on delivering supply side reform where possible – clearly demand has been quite strong in the economy, but supply hasn’t quite kept pace.
“What’s more, the big risk from today’s statement is that it may prove inflationary if the supply side doesn’t grow in line with demand.
“In summary, we didn’t expect this many measures at this stage - we thought we would see more pre-election giveaways at the next Budget. Today’s Autumn Statement demonstrates the pressure the Government is under with an election imminent over the coming year.”
Sue Noffke, Head of UK Equities, Schroders, said:
“This is an Autumn Statement for the masses; there were no changes to inheritance tax with the focus instead on putting money back into the pockets of the population.
“There is however a risk that this could be inflationary with growth expectations remaining low and, until now, inflation forecasts also declining.
“We are pleased to see the overarching focus on business investment and tax reform with the ultimate objective of solving the UK’s long-standing productivity challenge.”
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Note to Editors
Important Information: The views and opinions contained herein are those of Azad Zangana, Senior European Economist and Strategist and Sue Noffke, Head of UK Equities, Schroders and may not necessarily represent views expressed or reflected in other Schroders communications, strategies or funds. This material is intended to be for information purposes only and is not intended as promotional material in any respect. The material is not intended as an offer or solicitation for the purchase or sale of any financial instrument. The material is not intended to provide and should not be relied on for accounting, legal or tax advice, or investment recommendations. Reliance should not be placed on the views and information in this document when taking individual investment and/or strategic decisions. Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. All investments involve risks including the risk of possible loss of principal. Information herein is believed to be reliable but Schroders does not warrant its completeness or accuracy. Reliance should not be placed on the views and information in this document when taking individual investment and/or strategic decisions. The opinions in this document include some forecasted views. We believe we are basing our expectations and beliefs on reasonable assumptions within the bounds of what we currently know. However, there is no guarantee than any forecasts or opinions will be realised. These views and opinions may change.