So today sees the turn of the UK for strikes and demonstrations against budget cuts and austerity measures. Sterling is already feeling the pinch this morning with negative reaction, far outweighing that of Europe, weighing heavily on the currency. Other bad news out has not helped with more banking redundancies announced and further closures of businesses and retailers. Although this is no different to what is happening in most European countries the insular nature of the UK appears to exacerbate then situation and the fallout.
The Greece situation has waned a little but yesterdays successful vote has done nothing to quell the anti government feeling and it is highly likely that following today’s ratification vote further turmoil will be seen on the streets. Perhaps more importantly than the social unrest is the markets seemingly unworried view of the actual mess they’re in. The public debtor debts in Greece are a massive 150% of the whole country’s GDP, they need £4bn in the next two weeks to stave off bankruptcy and a further £100bn just to keep going and even with that and all of the cuts put together they are still going to struggle to meet repayments let alone pay off the loans. If it were you or I we would be put in jail and the key would be thrown away.
We, here at Axia,fully admit that this uncertainty in the UK and the global markets in general will go on for some while and the irrational currency moves seen of late will continue but we are equally as sure that when the dust settles, the UK will be ahead of the recovery curve.
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