After the initial hit to global markets following the outbreak of the Iran War, there were signs of some stability returning yesterday.

The bigger concern is likely to be around rising oil and gas prices and the potential knock-on effect for energy bills, petrol prices and, of course, inflation.

In the immediate term, economists are warning that any further cuts to interest rates are likely to be put on hold while the crisis plays out.

A lot will depend on how long the war continues. Will it, as President Trump has suggested, be concluded in a few weeks or, should things not pan out as he hopes, will it become a more protracted conflict with the potential for long-term economic shockwaves.

Of course, the outbreak of the Ukraine conflict four years ago is still very much in our minds. As with the current crisis in Iran, this initially led to sharp drops on the global markets and rising energy bills, only to later stabilise.

Our clients, many of whom have been with us for many years, will have experienced similar shockwaves due to military, economic or political events.

This is why we are resolute in our approach to financial planning for our clients, emphasising the importance of taking a long-term, diversified and balanced view.

What we have seen in recent days is part and parcel of the ebb and flow of the financial markets and how they typically react to the uncertainty of a global event such as this.

Closer to home, this week also saw Chancellor Rachel Reeves deliver her annual Spring Statement which she, herself, did everything she could in advance to position as a ‘non-event’. Unlike previous Spring Statements, there were deliberately no new tax or spending allowances.

Instead, we heard the latest forecasts from the Office for Budget Responsibility (OBR) including the downgrading of growth this year from the previous 1.4% to 1.1%. There was also the confirmation that the UK tax burden is on track to be 38.5% of GDP in 2030/31, a post-war record.

The pressure will continue to be on the Chancellor to unlock the greater levels of growth upon which her Government was elected with those with assets likely to be in her sights, potentially as soon as this year’s Budget.

We will continue to work with clients, where appropriate, to utilise allowances, protect what you can from tax and manage any inheritance tax position in a timely and efficient manner. 

As ever, you can be assured that we will continue to monitor events in the Middle East closely with further updates in future newsletters.

In the meantime, please do get in touch if you would like to talk through anything with a member of our team.