Skandia International’s latest adviser survey shows confidence in the global economy has fallen this quarter for the first time in twelve months. Confidence now stands at 5.8 out of 10, a slight fall compared to 6 out of 10 last quarter.
Financial advisers in the UK were the only region where confidence has stayed level at 5.9 this quarter and last quarter, with confidence falling in all other regions. The biggest drop was from financial advisers in UAE which fell from 7.1 to 5.8. Financial advisers in Europe also fell sharply from 6.2 to 5.2.
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The survey also reveals a sharp fall in financial adviser confidence in the Chinese economy. Confidence fell from a total of 6.1 out of 10 last quarter to 5.8 out of 10 this quarter. All regions reported a drop in confidence in the Chinese economy, with the largest drop coming from financial advisers in Singapore, which fell from 6.6 out of 10 down to 5 out of 10.
Financial advisers in the UK were the only region to report an increase in confidence in the local economy, increasing from 5.2 out of 10 last quarter to 5.8 out of 10 this quarter. All other regions reported a drop in the local confidence, with Singapore again showing the greatest drop in confidence, down from 7.2 to 6.4.
James Millard, director of investments at Skandia, comments:
"The recent difficulties in Asia are understandably impacting on global confidence. The abundant liquidity that had poured into the region following the global financial crisis is becoming increasingly scarce, and advisers and investors are becoming increasingly cautious. A stronger USD on the back of potential tapering of quantitative easing from the Fed and growing expectations of a US economic recovery has drained liquidity from emerging markets and commodities. Asian markets, particularly China, have suffered relatively. Compounding factors include; an overstretched banking system and slowing economic growth in China, whilst Yen depreciation has also made non-Japanese exporters in Asia less competitive in a time of lacklustre global economic growth."
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By GlobalData*The quarterly international adviser confidence barometer was conducted by Skandia International, part of Old Mutual Wealth, in Q2 2013 and attracted responses from 349 advisers from around the world – Hong Kong, Singapore, UAE, UK, Europe, Africa and Latin America.
