Sterling continued to drop late this week ahead of next week’s general election. Down 0.19% against the dollar on Friday, the pound was also 0.24% lower against the euro at 1.1462 euros.
Earlier forecasts of a landslide victory for the Conservative party have been sullied by recent opinion polls offering a much less clarity on what the likely outcome will be, with ongoing uncertainties affecting the markets accordingly.
The FTSE 100 otherwise rose 47.71 points in the opening minutes to reach 7,591.48, finishing higher on Thursday, but not at a new record. Meanwhile, mining stocks had an unusually mixed showing with Anglo American among key performers (up 1.5%), and Fresnillo and Randgold falling 0.6% and 0.5% respectively.
In the housing market, prices also fell for the third month in a row throughout May, according to Nationwide. With a decrease of 0.2% overall, the high-street lender said it is the first time a dip had been experienced for three months consecutively since 2009, while the annual rate of price growth slowed to 2.1%, its slowest pace for nearly four years.
Attributed to potential squeezes on household incomes caused by weaknesses linked to the pound, the building society otherwise refused to confirm whether this latest trend is anything more than a blip in the wider housing market generally.
Fixed mortgage rates have also dropped to new lows, whilst home loan approvals have also fallen to their lowest level since September. The Bank of England confirmed 64,645 mortgage approvals were processed for house purchases in April – a 2% fall on the previous month.
Meanwhile, the latest figures from HMRC show a record number of people are paying the highest rate of income tax, with an estimated 364,000 individuals paying the 45% rate of tax on income over £150,000.
A rise from 311,000 in 2013-14, they remain a minority of the total tax paying population however; representing 1.2% of income tax contributors across the UK. The amount of those paying basic (20%) and higher (40%) rates of tax has also fallen slightly.
In pensions, regulators are under pressure to reconsider annuity market reforms following concerns retirees in poor health are at risk of being sold unsuitable pensions. Insurers seeking meetings with the Financial Conduct Authority are keen to raise concerns around measures designed to ensure tens of thousands of people buying annuities each year are not short-changed, the Financial Times reports.
Reforms unveiled last week mean providers will be required to tell consumers seeking to buy an annuity if they are eligible for a higher return elsewhere. Insurers worry customers could be misled into thinking a competitor’s quote provided for comparison’s sake is market leading.