Chancellor Rishi Sunak has set out a series of revamped measures designed to halt job losses and stem
business failures as part of his Winter Economy Plan. Mr Sunak’s statement, delivered in the House of Commons on 24 September, was a last-minute replacement for the planned Autumn Budget which the Treasury had cancelled the previous day. That decision was taken in order to focus efforts on dealing with the short-term economic problems caused by the tightening of coronavirus restrictions. The centrepiece of the Winter Economy Plan was a new scheme to replace furlough, which will run from 1 November. The Job Support Scheme will last for six months and see government subsidise the pay of employees who work at least a third of their normal hours. Under the scheme, employers will pay employees for hours they actually work, with government and the employer each covering a third of the hours staff can’t work. Other announcements included a continuation of the self-employed grant on similar terms to the Job Support Scheme and an extension of the emergency VAT cut for tourism and hospitality until the end of March. In addition, the deadline on coronavirus loan schemes was extended and amended terms
introduced for existing borrowers, while businesses were given more time and flexibility to pay deferred tax bills.
During his statement, the Chancellor stressed that the government’s economic response to the pandemic
was evolving and that his aim now was to cushion a painful adjustment to a new way of living and working. He did
though make it perfectly clear that his emphasis has firmly shifted to protecting “viable” jobs. Despite cancelling the Autumn Budget, the Treasury has confirmed that it still plans to press ahead with a comprehensive spending review that is also scheduled to take place this autumn.  SFFS Economic Review_Sep 20

Although recent data has confirmed that the UK economy is recovering from its coronavirus lockdown slump, the
longer-term outlook (unsurprisingly) remains decidedly unclear. Official data released by the Office for
National Statistics (ONS) showed that the UK economy grew by 1.8% in May, following April’s record 20.3% contraction. While this modest rebound was lower than all forecasts submitted in a Reuters poll of economists, it did at least confirm a recovery is underway. Furthermore, data covering a more recent time period points to a marked
improvement in economic activity across the private sector as lockdown measures have eased. Indeed, the IHS
Markit/CIPS Flash Composite Purchasing Managers’ Index, where any value above 50 represents growth, stood at 57.1 in July. This was a noticeable rise from 47.7 in June and significantly higher than April’s survey-record low of 13.8. Bank of England (BoE) Governor Andrew Bailey also confirmed that he believes the economy has started to
recover. Commenting on UK economic prospects during a webinar organised by the BoE, the governor said: “We are
seeing activity return. We are beginning to see this recovery.” However, Mr Bailey also stressed that the strength of recovery will depend upon how cautious people are about returning to normal life and the risks posed by a potential second wave or localised COVID-19 outbreaks. He also added that it remains unclear how much long-term damage will be inflicted on the economy by companies failing. The Governor’s comments vividly demonstrate the high degree of uncertainty surrounding any assessment of the economic outlook, which has inevitably resulted in a wide range of views emerging. The median forecast, though, in a poll of over 70 economists, conducted by Reuters between 13-21 July, suggests the UK economy will contract by around 9% this year before expanding by 6% in 2021….SFFS Economic Review_July 20

Our economic review is intended to provide background to recent developments in investment
markets as well as to give an indication of how some key issues could impact in the future.
It is not intended that individual investment decisions should be taken based on this information; we are
always ready to discuss your individual requirements. We hope you will find this review to be of interest.

Major benchmarks closed the month in positive
territory, as some economic data boosted sentiment
towards the end of the month. A record jump in US
housing sales and a fourth straight month of growth
in Chinese manufacturing, served to offset some
concerns over COVID-19 infection rates.
• In the UK, the FTSE 100 gained 1.53% in June, to
6,169.74, the domestically focused FTSE 250 rose
0.45% in the month to close on 17,119.16. The Junior
AIM index closed on 883.75, a monthly gain of 0.96%.
The blue chip index closed Q2 up 8.78%, its biggest
quarterly gain since 2010, as a host of global stimulus
and an uptick in business activity as lockdown
measures ease, strengthened optimism about a postpandemic
economic recovery. Concerns do exist, as
local lockdown measures were imposed on Leicester
due to virus flare-ups in the city.
• On European markets, the Euro Stoxx gained 1.88%. In the US, the Dow Jones advanced
1.69% in the month to 25,812.88, while the tech
orientated NASDAQ returned 5.99% to finish June on
10,058.77. The Dow jumped over 17%, and the NASDAQ
over 30% in Q2, marking these indices’ best overall
quarters since 1987 and 2001, respectively.
• On the foreign exchanges, sterling closed the
month at $1.23 against the US dollar. The euro
closed at €1.10 against sterling and at $1.12 against
the US dollar.
• Gold is currently trading at around $1,783 a troy
ounce, a gain of 3.09% on the month. Investors are
keeping the precious metal in bullish territory despite
a surge in risk appetite. Brent Crude is currently
trading at around $41 per barrel, a gain of around 15%
on the month. A recent poll, highlights expectations
of a modest recovery in oil demand in Q3 and a
stronger rebound towards the end of the year and
into next, as oil demand is expected to pick up.  SFFS Economic Review_June 20 (003)

Our monthly economic review is intended to provide background to recent developments in
investment markets as well as to give an indication of how some key issues could impact in the future.
It is not intended that individual investment decisions should be taken based on this information; we are
always ready to discuss your individual requirements. We hope you will find this review to be of interest.

Official data has revealed that the headline rate of inflation in the UK is now at its lowest level since August
2016, as the economic fallout from the COVID-19 pandemic continues to force price rises down.
Figures released by the Office for National Statistics (ONS) showed that the Consumer Prices Index (CPI) 12-month rate – which compares prices in the current month with the same month a year earlier – dropped to 0.8%
in April. This was significantly lower than the previous month’s rate of 1.5% and represented the largest monthly fall in more than a decade.
A key factor behind this easing was a large reduction in petrol and diesel prices, following coronavirus-related
weakness in global oil prices. Cheaper clothing and footwear also helped force down April’s overall inflation rate, while previously announced price caps saw a reduction in household utility bills. There was some upward pressure, however, with prices of games and toys, as well a fresh vegetables, rising. ONS did strike a note of caution with
the data, as 92 items in the basket of goods and services used to calculate CPI inflation were not available to price checkers in April. These ranged from cinema popcorn and restaurant cups of coffee, to haircut prices. As a result, ONS fears inflation readings may be more volatile than usual. Over the coming months, inflationary
pressures are expected to ease further. Indeed, Bank of England (BoE) Deputy Governor Ben Broadbent has said the
Bank expects the CPI rate to approach zero during the fourth quarter and even suggested there was a possibility that
inflation might turn negative at the turn of the year. Mr Broadbent did, however, insist this would not represent the start of a damaging deflationary period.SFFS Economic Review_May 20

Newly appointed Chancellor of the
Exchequer, Rishi Sunak, delivered
his first Budget on 11 March,
against a backdrop of uncertainty
following the COVID-19 outbreak
and subsequent financial losses. It
was the first of two Budgets to be
delivered in 2020, with the second to
follow in the autumn.
COVID-19 AND THE NHS
The Chancellor wasted no time in diving
into the heart of the issue on the
minds of so many across the nation: the
COVID-19 crisis. Taking an empathetic
tone, he reassured the British public
that “we will get through this together”,
emphasising the temporary nature of
the crisis and his firm belief in the ability
of the British economy to weather
the storm.
Mr Sunak then called on all parties
across the House to support his £30bn
fiscal stimulus, including welfare and
business support, to “keep this country
and our people healthy and financially
secure”.
He pledged:
• £5bn emergency response fund to
support the NHS and other public
services
• Statutory Sick Pay (SSP) will
be paid to all those advised to
self-isolate even if they don’t
have symptoms
• To support businesses employing
fewer than 250, the government
would refund up to 14 days’ SSP
• A Coronavirus Business Interruption
Loan Scheme will support small
businesses experiencing increased
costs or cashflow disruptions, providing
access to £1bn of government-
backed loans
• Business rates in England will be
suspended for 2020-21 for firms
in the retail, leisure and hospitality
sectors with a rateable value
below £51,000
• Any company eligible for small
business rates relief will be allowed
a £3,000 cash grant.SFFS Simply Wealth Spring Budget_Mar 20