Brexit: UK recession warning as prime minister quits party leadership

first_imgSeema Shah, Principal Global InvestorsSeema Shah, senior global investment strategist, Principal Global Investors:“At $1.27 against the dollar, sterling has weakened in recent weeks, reflecting the repricing of Brexit risk as Theresa May’s time as prime minister draws inexorably to a close. Are we pricing in a no deal Brexit at these levels? No, the market is simply indicating that the risks of a no-deal Brexit have increased.“Were that nightmare scenario to unfold, sterling closer to parity against the dollar should be expected. Discussions of a potential rate hike remain almost incomprehensible, so an increase in uncertainty and volatility suggest the most likely path for UK rates is down rather than up.” What they said…Azad Zangana, senior European economist and strategist, Schroders:“[Boris Johnson] may look to take the UK out of the EU without a deal, despite parliament voting in favour of essentially removing the option. He could do this by failing to comply with the EU’s demands that the UK should continue to follow the rules. This presumably would lead to the EU agreeing to terminate the relationship in October.“If this were to happen, we would anticipate the economy to slow and fall into recession around the turn of the year. While the Bank of England would probably cut interest rates eventually, the expected depreciation in the pound would cause inflation to spike. The household sector has already run down its safety buffer in the form of its savings rate, therefore a contraction in demand is very likely.” Silvia Dall’Angelo, Hermes Investment ManagementSilvia Dall’Angelo, senior economist, Hermes Investment Management:“The risk is that under the next leader – most likely coming from the intransigent eurosceptic wing of the [Conservative Party] – the institutional tensions between the executive and parliament will intensify, potentially generating an even more fragmented and dysfunctional political landscape.“The next stage will probably result in early general elections, but other outcomes are possible, including a second referendum and a no-deal Brexit (the latter being the default scenario under current Brexit legislation). At any rate, the Brexit situation is unlikely to be resolved any time soon, and uncertainty will persist, which will continue to weigh on the country’s economic prospects and financial assets.” Theresa May delivers her resignation speech to journalists outside 10 Downing Street“It is, and will always remain, a matter of deep regret to me that I have not been able to deliver Brexit.“It will be for my successor to seek a way forward that honours the result of the referendum. To succeed, he or she will have to find consensus in parliament where I have not.“Such a consensus can only be reached if those on all sides of the debate are willing to compromise.”center_img Economists have issued renewed warnings of a possible UK recession after prime minister Theresa May this morning announced her resignation.May, who was appointed prime minister in the immediate aftermath of the country’s 2016 referendum on EU membership, said she would resign as leader of the ruling Conservative Party on 7 June, continuing as prime minister until a new leader has been chosen to succeed her.A number of Conservative Party members have been mentioned as potential successors, with former foreign secretary Boris Johnson tipped by bookmakers as the frontrunner. Johnson has been a vocal proponent of Brexit and several commentators today warned he could push the UK towards leaving the EU without a deal.Following May’s speech this morning, sterling strengthened against the euro after several days of poor performance as traders speculated on the likelihood and implications of May resigning. The FTSE 100 index was up nearly 1% for the day as of 2pm. Ludovic Colin, Vontobel Asset ManagementLudovic Colin, head of global flexible investment, Vontobel Asset Management:“In terms of the market reaction to today’s developments, the [sterling] and UK assets will be vulnerable in the coming month. But the hard Brexit would add bad news to a landscape that is worsening already. It could trigger deeper corrections to global risky assets like equities and credit markets especially in Europe.“At the moment, investors will need to avoid UK risk in their portfolio. Even if at micro levels there are some very good companies in the UK, investors will see much better entry points in the future.”Mark Dowding, CIO, BlueBay Asset Management:“Our analysis of the current composition of parliament suggests that any new prime minister might struggle to deliver a hard Brexit through parliament with the [Conservative] majority non-existent and a number of Conservatives still firmly committed EU remainers. Consequently, we continue to look for election risks with a new prime minister seeking a stronger mandate. Should this occur, this in turn points to a material chance that there will be a Labour coalition government in place before the end of the year. “In the same way risks seem skewed to a weaker pound, so we would see risks skewed to much higher Gilt yields with such an outcome and so continue to maintain short positions in both – even if little has really happened to either UK rates or FX since the 2016 referendum in the grand scheme of things. The Brexit endgame will be in sight before the end of the year and we therefore feel the moment where these views may play out is just around the corner.”… and what she saidTheresa May, outgoing UK prime minister:last_img read more

Royal Portrush backs upgrade plans

first_img Royal Portrush has undergone seven significant changes since the course first opened as The County Club in 1888 but no development work has been done in the decades since the Open visited in 1951. The R&A, organiser of the Open, has been notified of the decision. The hour-long hotel meeting on Friday night was held after detailed planning by the club’s management including architect Martin Ebert, laying the groundwork with a model exhibition and maps in the clubhouse to show all the changes. Members were taken on tours of the prestigious Dunluce Links in groups of 40 or 50 for experts to walk and talk them through the redevelopment. The Dunluce course will be improved to a par 71 of 7,337 yards. Among the changes will be new greens – the eighth will be a two-tier and the par-five ninth will become a par four. Some new bunkers will be dug while the current practice ground will be used for tentage. A 75-page brochure has been made available, primarily for members, to outline how the changes will alter the courses. Mr Tweedie added: “It’s a massive sense of excitement in terms of getting the opportunity to get the course strengthened and enhanced. The opportunity it’s bringing for so many people in terms of members and then in terms of the general public, for Portrush, for Northern Ireland and for Ireland.” Royal Portrush was added to the Open rota in June, with 2019 a potential date for its long-awaited return to major golf. The decision was sparked in part by the record-breaking attendance at the 2012 Irish Open at the venue. The spectacular course on the scenic Causeway coast is the only venue outside England and Scotland that has staged the Open. Several major championship victories by local superstars Rory McIlroy, Graeme McDowell and Darren Clarke since 2010 have added impetus to the campaign to bring the championship back, with all three lobbying on behalf of the course. The R&A envisages Royal Portrush hosting the tournament on a regular basis in the future. A special meeting of members voted overwhelmingly in favour of the first redevelopment of the world-renowned links in the 63 years since it hosted the major tournament. Only two of the 237 who attended the Magherabuoy Hotel in Portrush on Friday refused to back the plans in a show of hands, with i nsiders suggesting the opponents – two men from one family and in their 30s – were voting against it for a bet or a joke. Philip Tweedie, a past captain and current member of the club’s tournament committee, said there was a feeling of excitement about the progress. “We always wanted to have a unanimous decision as much as possible so there was unity in the club and we think that is what we have achieved,” he said. A planning application is expected to be made by mid-October but authorities are not likely to make a decision until possibly next April. In an attempt to expedite the process and avoid confrontation with environmentalists, the club has already undertaken ecology reports on the dune system. Work is being tentatively planned for autumn-winter next year. The first redevelopment will be on the Valley course alongside work on new greens on the Dunluce course, but any significant infrastructure changes are being planned not to coincide with bird-nesting season. Mr Tweedie added: “Everything has got to improve and strengthen. Ultimately what we are working on the Dunluce and Valley links are creating stronger courses that are fit for Open competitive golf.” The changes will involve taking two holes out of the Valley course and creating three new holes, plans which Mr Tweedie described as “stunning”. Royal Portrush has passed the first hurdle in plans to upgrade its courses and bring back the Open Championship by 2019. Press Associationlast_img read more

Virat Kohli, MS Dhoni will cause traffic jams in Pakistan: Wasim Akram

first_imgPakistan’s cricketers cannot seem to get enough of India. Soon after Shahid Afridi landed himself in hot soup after professing his love for Indian fans, former Pakistan skipper Wasim Akram reckoned Indian superstars Virat Kohli and Mahendra Singh Dhoni would cause traffic jams across the border, thanks to their massive popularity there.Afridi was served a legal notice after stating that cricketers from Pakistan were loved more in India than in his own country. This caused an outrage back in Pakistan with former skipper Javed Miandad slamming Afridi for his comments. Miandad in fact said that players making such statements should be ashamed of themselves.However, Akram, who is a darling with the Indian masses, said Afridi should focus on his cricket instead of thinking of what is going on back home. Akram said cricket was popular in both countries and cricketers drew mutual admiration.”Afridi should concentrate on cricket than what is happening back in Pakistan. There is too much pressure on him right now and I can only wish him luck,” Akram told Sports Today. (Afridi skips practice ahead of first match )Akram said India’s run-machine Kohli and limited-overs skipper Dhoni enjoy superstar status in Pakistan. Pakistani fans have for years idolised and feared Sachin Tendulkar in equal measure while followers of the game in India have held the likes of Akram, Imran Khan and Miandad in great awe.”There will be traffic jams if Virat Kohli and MS Dhoni visit Pakistan because cricket is a loved sport in both the countries,” Akram said.advertisementHowever, irrespective of the reactions back home, Afridi, who is camping in Kolkata with the rest of the Pakistan sqaud, has won Indian hearts. That could go a long way in easing  some pressure for the visitors ahead of the high-profile clash between the arch-rivals at the Eden Gardens on Saturday.last_img read more