Commenting on the new UK Prime Minister Rishi Sunak, RLAM Head of Multi Asset Trevor Greetham said:
“Rishi Sunak becomes Prime Minister at a time of high inflation and great economic uncertainty. While a more orthodox approach to fiscal policy should calm the bond markets, the prospect of public spending cuts as the Bank of England raises interest rates will do nothing to ease recession fears.
“The UK is the only G7 economy with GDP still below its 2019 peak after the hard Brexit and Covid 19 shocks.
“Improving trading relations with Europe and dealing with the supply side after effects of the pandemic should be top priorities for the new administration. Sustainable growth is the best route to sustainable public finances."
The views expressed are those of the author at the date of publication unless otherwise indicated, which are subject to change, and is not investment advice.