Here’s a quick update following the weekend’s ‘escalation’ (for want of a better word…) and how it could impact confidence and property transactions and eventually, your wallet!
What could happen next - If Iran disrupts oil supplies in retaliation, we are going to see oil prices rise — this typically pushes up inflation and increases everyday costs for households and businesses (including you and me!).
If that inflation starts to squeeze growth or spending, it could put more pressure on the central banks to cut interest rates at a faster pace than already expected in an effort to stimulate the economy and ease borrowing costs. This would lower mortgage costs — which could help boost property market activity.
Currency reactions are more difficult to predict, as other central banks may also start cutting rates — so it’s definitely one to watch…
A key factor will be confidence and something called ‘money velocity’ — in simple terms, how quickly people are spending and therefore how confident they are. As we know confidence drives transactions, and if that drops, so do deals.
It’s still too early to see a clear market reaction — the US stock exchange opens this afternoon and should give more direction.
But, sellers are likely to see more enquires from US clients as a result at the top of the market.
If you’ve got any questions or want to chat more about how this might impact you personally, whether buying, selling, moving money around or investing, just give @SteveEakins a shout. Or better still send him a message!
Have a lovely week everyone and if I hear anything else I’ll keep you posted.
My bet is that the US market will rise today. War is good for business. Each of those 14 bunker buster bombs costs $3.5 million, so just to replace those used at the weekend will cause $49 million of additional government expenditure to be ploughed into the US economy.
IMO for balance the New York Times, La Monde, the Guardian and Haaretz. Especially Haaretz, the editor, Aluf Benn, is a very, very smart and well informed guy.
The New York Times. A 12 month web edition sub can be had for as little as €20 p.a.
Its coverage of everything, everywhere, is second to none, including UK domestic politics. The standard of writing is excellent. Its position is just left of centre - tho’ virulently critical of The Orange Imbecile in its editorials but ‘balanced’ in reporting, even of his most egregious doings and utterances.
A bonus, for me is that their cooking strand is now my source of recipes, daily. I really need to be 1500 miles south when it comes to ingredients.