New figures reveal that nearly half a trillion pounds have “gone missing” from the finances of Britain.
A change of the country’s accounts by the Office for National Statistics reveal that the net international investment position of the United Kingdom has fallen from a surplus of £469bn to a net deficit of £22bn.
The ONS ‘blue book’ overvalued the scale of financial assets that Britons own overseas and the depth of foreign investment in the United Kingdom.
“Half a trillion pounds has gone missing,” stated the UK rates strategist at Bank of America, Mark Capleton.
Other economists have suggested that sovereign wealth funds and foreign-owned pension funds are also very hesitant to invest the money of their clients in sterling stocks and bonds.
The deadlock over Brexit is regarded as a major roadblock to foreign investment, with finance firms not willing to commit in such an uncertain political climate.
That said, opening nearly 12 points higher on Monday morning, the FTSE is in rude health.
Ahead of next month’s Budget, the ONS ‘blue book’ figures will be another sobering warning to Philip Hammond, the chancellor.
Also, it will only serve to add another layer of pressure on Prime Minister Theresa May, and David Davis, her Brexit secretary, as they sit down for dinner this week with Jean-Claude Juncker, the European Councpresident and Michel Barnier, his Brexit lead.
The four of them will try to look for a way of moving the stalled negotiations forward as the European Union and the United Kingdom struggle to get past the issues of the citizens’ rights, the Irish border, and the divorce bill.
On Thursday, All 28 national leaders will meet in Brussels to discuss the schedule of Donald Tusk, the European Union President and summit host for the post-Brexit future of Europe, among other issues.
Theresa May will then be requested to leave after breakfast on Friday so that the 27 other leaders can weigh up Brexit.
Over the weekend, John McDonnell, Labour’s shadow chancellor said that there would be enough MPs to prevent the “no deal” scenario of Theresa May and stop the United Kingdom from leaving the bloc without an agreement in place.
Pro-Europe MPs fear that leaving without a deal would be catastrophic for the country, while Brexiteers think that the United Kingdom would be successful with or without or a deal.