While the forecast for the coming year looks gloomy, there is light at the end of the tunnel

Most economic forecasters agree that 2023 is not going to be a great year with a recession predicted until the end of 2023 as output falls by 1.9%. PWC also suggests that pressures on the cost of living will continue with the weekly food shop having doubled to £100 since 2000, house prices estimated to fall by 8% and the measurement of “happiness” at its lowest level which will lead to an increased number of divorces.

So where do you find the crumbs of optimism in that lot?

Lisa Doig, Director and adviser commented that “although a recession is expected – we’re not there yet and if and when this does happen – the markets had already costed in the effects of it last year.  Sentiment is that the worst is over, the big shocks have been and gone and green shoots are slowly starting to appear.  The road to recovery is not that far away.

Lisa Doig, director at RobMac

• There is an expectation that more workers will return to the labour force during the year which will help to boost output. PWC estimates that 300,000 UK workers will be available and that there will also be an increase from immigration workers which when combined will be worth 1% of GDP.
• Inflation has already peaked and we expect it to be down to around 5% by June this year.
• Markets have continued to be stable and started the year well, not just in the UK but in other European markets too. This positive start is seen to be partly due to the easing of Covid sanctions in China and the associated positive sentiment that brings.

For us, staying put when there is a lot of negative financial pressure is the best possible strategy to weather the storm and come out the other end of recession in a better position than before the start of the financial crisis.

On 12 Jan 2023 the FTSE 100 recorded its highest value in the last 5 years and over 2,500 points higher than the start of the financial crisis on 20 March 2020 as a result of Covid.

So, to quote the opening lines of Rudyard Kipling’s “If”, we believe that:

“If you can keep your head when all about you
Are losing theirs”!

If you are interested in learning about what makes RobMac different and think that we can help, then please get in touch. If you would like to discuss your financial position or mortgage further, you can arrange to meet online with one of our financial advisers. You can call us on 0131 226 6700.