Covid -19 Update and Communication
As the Lockdown continues, we continue to see our everyday lives affected by the Pandemic and the daily Government briefing continues to bring further bad news, although there are more and more positive signs from around the world and more countries relax the strict rules on social isolation. Thankfully most people in the UK have adhered to the guidelines and we are seeing a slowdown in rates of infection and more importantly in fatalities. It is as important as ever to stay safe and we can start to see some glimmer of light at the end of the tunnel, although it is likely to be a rocky journey for us all.
Over the last few weeks we’ve been working hard to deliver an uninterrupted service to you, whilst adhering to government guidelines and protecting our team. Skerritts has made sure that we can deliver all of our services to you remotely.
If you have a planned meeting in our office over the next eight weeks, please contact your Adviser to discuss how this can be done remotely (we are using Zoom with many clients and this is working well).
During the “delay” phase of the government’s COVID 19 action plan:
All of our advisers are set up to work remotely and they will continue to answer calls and to respond to emails queries and provide advice as usual
Our Investment team whose activities are usually conducted onsite are now conducted remotely and this is working extremely well
Teams that support advisers are working remotely and we have ensured that by doing so we have embedded a framework to keep our clients data safe
Skerritts will accept digital signatures for all our documents, and use a range of digital services to support advisers and clients
Our Post is redirected from our offices, scanned and distributed to the correct adviser or teams
Our website will continue to operate as usually and is regularly updated
We have encountered some delay with the postal system so we would encourage all clients to use alternatives such as our client portal to upload documents, our digital services and email before posting information or documents to us. If you have any queries please contact your usual adviser by email or calling 01273 204 999.
In terms of the investment markets, just over 6 weeks ago, the global economy looked poised for a solid, if unspectacular, 2020. We’re now in an altogether different situation. Unfortunately, that situation is a deep global recession caused by a pandemic. Consumers are not spending and companies are facing a cash-flow crisis. A sharp rise in unemployment and bankruptcies is now unavoidable.
Risk assets have moved lower to reflect this scenario, but we now have to assess whether they have declined enough to compensate for the challenges ahead. Policymakers have responded by announcing huge monetary and fiscal stimulus packages, providing life support to the global economy whilst it remains shut down.
As we head through the second quarter of 2020, GDP is forecast be 20% to 30% lower than this time last year. Global GDP in 2019 was approximately $87 trillion which means up to $6.5 trillion of output will be lost this quarter. Central banks and governments have already committed to a combined $10 trillion of monetary and fiscal support, with more likely to follow. Such a forceful response may result in a strong recovery in the second half of the year.
The main risks to this view are a protracted global lockdown, or a second wave of infections after economies have re-opened. However, lockdowns cannot go on indefinitely and we will have to learn to live with the virus until a vaccine is made available. A number of European countries have outlined measures to ease restrictions throughout May, and President Trump, focussed on November’s election, will continue to pressure State Governors to re-open.
This may sound very “doom and gloom” but it’s important to remember that the markets have already factored in an uncertain outlook. As before, we expect things to be volatile for a while, but as economies begin to open, markets should react favourably.
Another positive sign is that we are starting to see high levels of new money being invested into our funds and portfolios as investors see value in the markets and look to gain as the markets pick up.
We will continue to keep you updated and we wish you and your families well.