US CPI Numbers Likely To Head Below Zero Later This Year

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The following are the comments from Henderson Rowe’s Artur Baluszynski and Kingswood’s Rupert Thompson, discussing the US CPI numbers, how the lockdown helped UK’s economy and UK’s economics declines.

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Q1 2020 hedge fund letters, conferences and more

Commenting on US CPI numbers rapidly heading south

Commenting on US CPI numbers rapidly heading south, Artur Baluszynski, Head of Research at Henderson Rowe, said: “Almost all components related to discretionary spending, travel or fuel are in free fall. With consumer demand being destroyed by the lockdown measures, it's no surprise to see headline CPI numbers heading south fast. Add to the mix lower energy prices and we should expect the headline CPI number to go below zero later this year.”

Commenting on poor UK GDP but how a more relaxed lockdown helped economy

Commenting on poor UK GDP numbers but how more relaxed lockdown measures helped the economy, Artur Baluszynski, Head of Research at Henderson Rowe, said: “The numbers are really bad, especially considering that the lockdown only started mid-March. One of the reasons why the -2% figure is better than expected is because the real impairment of the consumer demand is likely to show up in April numbers. However, we can now see how the UK's more relaxed lockdown measures helped the economy to fare better than France or Spain which contracted close to 6% over the same period.”

Commenting on the UK economy shrinking by a record 5.8%

Commenting on the UK economy shrinking by a record 5.8%, Rupert Thompson, Chief Investment Officer at Kingswood, said: “The UK economy shrank by a record 5.8% in the month of March with GDP down 2.0% over the first quarter as a whole. The declines were somewhat smaller than expected but little comfort should be drawn from that as the economy looks certain to see a much larger contraction over coming months. With the lockdown looking set to be relaxed only very gradually, a drop in GDP of the order of 25% remains quite probable in the second quarter.”


About Henderson Rowe

Henderson Rowe is UK boutique wealth management firm that provides private clients with institutional-quality investment strategies and asset allocation solutions. Outside the private client space, Henderson Rowe’s affiliated companies serve global institutional investors both directly and through partnerships with some of the world’s largest asset managers.

About Kingswood

Kingswood Holdings Limited (trading as Kingswood) is an AIM-listed (AIM: KWG) integrated wealth management group, with on closing of the WFI acquisition around 5,500 active clients and c. £2.5 billion of Assets under Management and Advice. It has a growing network of offices in the UK including Abingdon, Beverley, Derby, Lincoln, London, Maidstone, Sheffield and Worcester, and offices in Johannesburg, South Africa and New York, USA.

Kingswood offers a range of trusted investment solutions to its clients, which range from private individuals to some of the UK’s largest universities and institutions, including investment advice and management, personal and company pensions and wealth planning.  Kingswood is focused on becoming a leading player in the wealth management market through targeted acquisitions in the UK, with the ultimate goal of creating a global business through strategic partnerships.

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About the Author

Jacob Wolinsky
Jacob Wolinsky is the founder of ValueWalk.com, a popular value investing and hedge fund focused investment website. Jacob worked as an equity analyst first at a micro-cap focused private equity firm, followed by a stint at a smid cap focused research shop. Jacob lives with his wife and four kids in Passaic NJ. - Email: jacob(at)valuewalk.com - Twitter username: JacobWolinsky - Full Disclosure: I do not purchase any equities anymore to avoid even the appearance of a conflict of interest and because at times I may receive grey areas of insider information. I have a few existing holdings from years ago, but I have sold off most of the equities and now only purchase mutual funds and some ETFs. I also own a few grams of Gold and Silver

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