2 August 2016
It looks increasingly as if the UK economy is beginning to feel the pain of the Brexit vote. The UK construction industry has recorded a further deterioration during July 2016 and the Purchasing Managers Index (PMI) is now at 45.9 from a reading of 46 in June – a reading of less than 50 suggests activity is decreasing. This will add pressure to the Bank of England Monetary Policy Committee which meets this week to discuss interest rates yet again.
Opportunities for overseas property investors abound in the UK post-Brexit, particularly from US$ based buyers. Being part of the EU is of little interest to many property investors, who continue to see London as a great city in which to hold property. Whilst institutional investors are still being cautious, investors from China and the Middle East are taking advantage of the low sterling to make strategic investments.
Corporate governance changes may be on the way, with PM Theresa May’s desire to see employees represented on company boards perhaps being forced into the mix.
The FRC have issued guidelines for listed companies to clearly set out in their reports details of their EU operations and the risks and uncertainties that come from that; all with the objective of giving a true and fair picture to shareholders.
There could be major revisions to VAT post-Brexit, since the UK will regain full control over the tax and how it applies in the UK. Finance and insurance sectors may benefit, although jobs may be lost as companies set up EU distribution hubs to overcome export issues.
Who wants to go to Chevening House? This is the 17th Century “grace and favour” retreat for the Foreign Secretary; but unfortunately for Boris, he will have to share it with other Brexit ministers, David Davis and Liam Fox. Should make for fun weekends over the dinner table!
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