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Brexit Britain: Buy or sell?

Wednesday, March 29, 2017 - 01:54

Britain, buy or sell? Investors, traders and economists weigh up whether the UK is a viable place to hold assets as it takes the first formal step on an uncertain Brexit journey. And as Laura Frykberg reports, some UK-based companies may also take a second look.

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The relationship was always going to end very publicly. But the tabloids perhaps missed the more important story... That could shape Prime Minister Theresa May's final Brexit deal. SOUNDBITE (English) GARVAN WALSHE, CEO OF BREXIT ANALYTICS SAYING: "it will depend on whether the economy does well or badly over the next two years. If she feels economic pressure, the forces of moderation will be strengthened. If on the other hand, global growth is so strong that Britain comes to feel that it can weather the storm, then the hard-liners will be strengthened." So far, it has been. UK growth is strong and unemployment is low. But that could change with warnings from big businesses. Ryanair has threatened to suspend flights between Britain and the EU in 2019, if the Brexit deal doesn't protect the single aviation market. U.S. carmaker Ford - which also operates in the UK - insisting too, that tariff-free access to European countries must continue. SOUNDBITE (English) MIKE INGRAM, MARKET STRATEGIST, BGC PARTNERS, SAYING: "The best deal overall is clearly going to be retaining free trade agreements, passporting rights etc, reciprocity in terms of regulation. But you know we are edging up towards that sort of cherry picking, which a number of senior figures with the European Union have said it basically impossible." Some say a so-called hard Brexit could improve the economy though. A weaker pound luring more investors. And allowing businesses to operate outside a regime of EU rules. SOUNDBITE (English) JAMES HUGHES, CHIEF MARKET ANALYST, GKFX, SAYING: "Then that makes business from a London perspective easier and it makes it easier to attract other businesses or keep those businesses here in London." But of course all businesses need consumers. The key drivers of the UK economy since the Brexit vote last June. And with inflation on the rise, the risk is it'll be them ultimately paying the highest price.

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Brexit Britain: Buy or sell?

Wednesday, March 29, 2017 - 01:54