Brexit May Be Boring, But Watch Your Finances

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Most people are bored with Brexit but must watch what’s happening because they are concerned about their finances, while expats will be worried about the value of the Pound, says a leading investment expert.

The big question as the political infighting unwinds at Westminster, almost changing by the hour, is what does the possibility of a General Election mean?

Prime Minister Boris Johnson is challenging people within his own party, explained Nigel Green, CEO and founder of world leading financial advice firm for expats deVere Group.

“He feels in a strong position because the polls are giving him a massive boost in popularity. He’s in that honeymoon period where people believe he can deliver Brexit,” said Green.

“The UK is bored with Brexit and they know there is some pain coming but most people would prefer to get it over with. So Boris is in a situation where he is challenging his party. He’s saying back me and I’ll deliver Brexit but I can’t promise it’s not going to be a hard Brexit.

Johnson’s back me plea

“Meanwhile people in the party are saying we don’t want a hard Brexit. After all, 46% of the UK’s trade is with Europe, and that’s massive. The UK needs some sort of trade agreement with the EU and people within the Tory party realise if they go for a hard Brexit, there’s going to be a potential period of real hardship.

“They want to avoid that possibility, but Johnson is saying you need to back me so I can negotiate and if they don’t, he is going to call a General Election.”

“And he believes because of his popularity, it’s the right time to call an election, but Labour appears to be in disarray. They’re in the middle and don’t seem to know if they are for Brexit or against it. They are indecisive and Johnson thinks he can take advantage of that.

“Lib Dems are also rising fast in popularity and they are taking the opposite no Brexit view.

“The Brexit Party’s Nigel Farage has promised if the Tories promise a Brexit, as either a hard Brexit or with a deal, he will back out of the election. That pledge gives Boris more power but could this split the Tories?

“Could it mean some of the Tory party could leave? It may not be the same Conservative Party in the future and the public could even decide an election gives them a chance to say that they don’t want Brexit after all.

Sterling nearly at the bottom

“Voters do seem to want to stop this pain and do some sort of a deal with Europe. It seems Johnson is likely to win, but we have a period of uncertainty.

“You should diversify your assets. Gold is one area that a fund manager might look at. You should stay invested because if Brexit is resolved, assets can rise.”

As Sterling hits a 34 year low, Green looks at what’s in store for the Pound.

“What about Sterling? Now it’s £1.19 or £1.20 against the US dollar. I’d stick with Sterling, but it’s my opinion and lots of things could happen and your adviser may take a different view. I think we are close to the bottom and the bad news is already priced in,” he said.

“If we are close to a low, assuming we get some certainty, then we are likely to see a rise in Sterling. It won’t be massive because we have some pain to go through before we see a recovery, so don’t think the price is going to shoot back up.

“If the politicians make the right decisions, Sterling will go back up, but I suspect £1.30 or £1.35 to the dollar in the future is probably as high as the price will go.”

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