On Thursday 2nd February, the Bank of England raised interest rates to 4%, the highest in 14 years. PHPD will collect reactions from across the industry. This post may be updated as more reactions come in.
Jatin Ondhia, CEO of Shojin, said: “After ten consecutive rate hikes, there is a worrying sense of déjà vue, as the Bank of England’s heavy-handed approach shows no signs of abating. Undoubtedly, this move will present further challenges ahead, just days after the IMF downgraded its growth forecast for the UK’s economy.
“As investors continue to navigate testing market conditions, the reduction of real returns through higher inflation represents a significant threat to both fixed income investments as well as equities. Against these headwinds, investors must keep a cool head and consider the tools at their disposal to make their money work harder.
“I would expect the diversification of investment portfolios to remain a prominent trend in 2023, as inflation remains in double figures but rates rise. It is also likely that tax-efficient investments will gain increasing traction in the months ahead, with investors trying to manage returns in the most effective ways possible.”
