Market Commentary May 2017


Craig Hendry

Craig Hendry

Managing Director & Chartered Financial Planner


The FTSE 100 reached an all-time high in May of 7,547.63 as the pound continues to be weak against the dollar. Despite the threat of an energy price cap, the major energy providers have had a good month.

The Bank of England voted 7-1 to keep the base rate of interest at 0.25% in its May meeting. It did note that inflation has risen to 2.7% which is in excess of the Bank’s target of 2%. Should inflation continue to increase it will put pressure on the bank to consider raising the base rate. 

Oil has had a tumultuous month with the price falling to a low of $48.38. Subsequently, OPEC members have announced that there will be an extension to the production cut that was agreed back in November until March 2018. This news has led oil to finish the month at $50.31 - around 4% up from its low.

The € has fallen 3% against the £ in May as speculation mounts that Greece will default on its latest repayment of its bailout.

The next major event for markets to negotiate will be the General Election on 8 June.

 31 May 20171 month6 months12 months
FTSE 1007,519.954.39%10.85%20.69%
GBP/USD1.2899-0.29%3.32%-11.24%
GBP/EUR1.1480-3.32%-2.71%-12.04%
Brent Crude (US$)50.31-2.75%-0.32%1.25%
Gold (US$ per oz)1,268.920.05%8.16%4.41%

Sources

XE.com

Bloomberg.com

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