What A Trending Rise In Unemployment Means For Market Confidence
What A Trending Rise In Unemployment Means For Market Confidence

What A Trending Rise In Unemployment Means For Market Confidence

 
Unemployment in the UK has been on the decline since early 2012, although the current coronavirus outbreak has only increased those figures, albeit slightly. Despite the government’s best efforts at supporting businesses and encouraging them to furlough their employees rather than lay them off, many people have found themselves unemployed. What kind of unemployment rates are we looking at in 2020 and what does it mean for the market?
 
Unemployment
 
ONS reports that job vacancies sank by 52,000 year on year to 795,000 for the first three months of 2020. The more concerning fact is that UK unemployment grew from 22,000 to 1.36m and that was before March’s coronavirus lockdown. The government’s pledge of dedicating funds to unemployment pay saw a record high increase of 76.6%. With the lockdown affecting millions of jobs in the UK and people’s ability for productivity and the time it will take for businesses to bounce back it is likely that unemployment will continue to increase even after lockdown is lifted.
 
How Is The Market Reacting?
 
You might think that laying a significant number of employees off says that a company is not doing so well, so why is the stock market remaining healthy? Many market experts have commented on the phenomenon and have expressed that the market estimated that unemployment rates would actually be much worse than they are. Those early rumours we were talking about in our earlier blog actually meant that the market prepared for worse than what happened, seeing a healthy rebound rather than an unhealthy plummet.
 
Does That Mean It’s A Good Time To Trade?
 
Most people have found themselves with more spare time and that seems to make it a great time to get into online trading and investing. Of course, the rise in unemployment rates and general uncertainty haven’t exactly left people with spare cash, so it’s important to honestly assess your financial situation before you approach the markets. If you do have a budget to play with, now could well be the time to learn more about trading and investing!
 
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. The vast majority of retail client accounts lose money when trading in CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
 
Contact CFI
 
To learn more about investing in today’s global markets, contact CFI Financial today and speak with someone who can answer any questions that you might have.
 
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We would like to remind that while we endeavour to provide best possible services, CFI provides execution only services and any information, reports, opinions, commentary or other materials he receives from CFI directly or from its employees or through any analytical tools provided to him or third party research provided to him from the Company shall not be deemed as investment advice and it cannot be relied upon to make investment decisions. The Client commits to make his own research and from external sources as well to make any investment. The Client accepts that CFI will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information. The contents of any report provided should not be construed as an express or implied promise, as a guarantee or implication that clients will profit from the strategies herein, or as a guarantee that losses in connection therewith can, or will be limited.


Forex and CFDs are leveraged products that incur a high level of risk and a small adverse market movement may expose the client to lose the entire invested capital. The vast majority of retail client accounts lose money when trading in CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. The possibility exists that you could sustain a loss in excess of your deposited funds even if a stop loss is used and therefore, you should not speculate with capital that you cannot afford to lose and be aware of trading risks. Credit Financier Invest (Mauritius) Ltd provides general information that does not take into account your objectives, financial situation or needs. The content of this website must not be interpreted as personal advice. Please ensure that you understand the risks involved and seek independent advice if necessary.

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