The UK Supreme Court’s ruling that Boris Johnson’s suspension of parliament was unlawful will not boost optimism in the pound and UK financial assets, warns the CEO of one of the world’s largest independent financial organisations.
The comments from Nigel Green, the CEO of deVere Group, follow the unanimous judgement by the highest court in the land on Tuesday that the prorogation of parliament was “unlawful” because it had the effect of frustrating democracy.
He observes: “This is a massive blow to UK Prime Minister Boris Johnson and his approach to Brexit. It would suggest that the possibility of a hard Brexit – and all its associated perceived threats – has further reduced.
“However, the ruling will not, in fact, deliver a major boost of optimism to the pound and UK financial assets because the Brexit timetable remains in place.
“The Brexit-fuelled political uncertainty deepens, and this will temper any significant upside. Sterling and UK financial assets remain flat.”
Mr Green continues: “MPs are on their way back to the House of Commons and they have already rejected a no-deal exit. Therefore, Boris Johnson needs to get on with securing a deal with the EU that will get through parliament.
“He needs to play strongly the hand with the EU that it’s in their economic best interests to reopen negotiations. After all, the last thing they need is a no-deal and be unable to trade effectively as they do now with the UK, especially as the wider EU and global economies are slowing.”
The deVere CEO concludes: “As the saga and uncertainty continues, it can be expected that both UK domestic and international investors in UK assets are increasingly likely to move assets away from the UK to grow and safeguard their wealth.”
Earlier this month, a deVere Group survey found that there’s been a 35% increase in investors seeking to reduce their exposure to UK assets (barring UK property) since Mr Johnson became PM in July.
deVere Group is one of the world’s largest independent advisors of specialist global financial solutions to international, local mass affluent, and high-net-worth clients. It has a network of more than 70 offices across the world, over 80,000 clients and $12bn under advisement.