October proved a difficult month for investors. The trade tensions between the US and China, on-going Brexit negotiations and the EU’s rejection of Italy’s draft budget all seemed to weigh heavily on global equity markets.
The FTSE 100 ended October at 7,128.10, which was 5.1% lower than the September closing figure of 7,510.20.
Similarly, in the US, the Dow Jones Industrial Average’s performance was down 5.1% as well, closing October at 25,115.76.
In terms of £ Sterling, it ended October at 1.28 US Dollars. This was 2.1% lower than the closing figure at the end of September.
Against the Euro, the £ Sterling strengthened ending October at 1.13 Euros, which was 0.5% higher than the September closing figure.
Inflation, as measured by the Consumer Prices Index including owner occupiers’ housing costs (CPIH), was 2.2% in September 2018 (this is September’s data which is reported in October). This was down from 2.4% the previous month.
The 12-month rate for the Consumer Prices Index (CPI) rate which excludes owner occupied housing costs and council tax was 2.4% in September 2018, down from 2.7% in August 2018.
The Bank of England maintained interest rates at 0.75% in October following the increase in August. Despite the drop in inflation, this means long-suffering deposit savers continue to lose money in real terms when you consider the rate of savings interest compared to the rate of inflation.
With external influences remaining uncertain, it is reasonable to assume that we may well be entering a volatile period for investors and as usual it remains increasingly important to invest in a well diversified investment proposition.