Meat bans and ‘un-Brexit’? One financial institution’s ‘outrageous’ 2023 predictions

Meat bans, hovering gold costs and Britain voting to ‘un–Brexit’ might be on the playing cards for 2023, in response to Saxo’s Outrageous Predictions.

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Saxo Financial institution’s “outrageous predictions” for 2023 embrace a ban on meat manufacturing, skyrocketing gold costs and Britain voting to “un-Brexit.”

The Danish financial institution’s annual report, printed earlier this month, expects international economies to shift into “struggle economic system” mode, “the place sovereign financial beneficial properties and self-reliance trump globalisation.”

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The forecasts, whereas not consultant of the financial institution’s official views, checked out how selections from policymakers subsequent yr might affect each the worldwide economic system and the political agenda.

Gold to hit $3,000

Among the many financial institution’s “outrageous” requires subsequent yr, Saxo Head of Commodity Technique Ole Hansen predicted the value of spot gold might exceed $3,000 per ounce in 2023 – round 67% larger than its present worth of about $1,797 per ounce.

The report places its forecasted surge down to a few components: “an rising struggle economic system mentality” that makes gold extra interesting than overseas reserves, an enormous funding in new nationwide safety priorities, and rising international liquidity as policymakers attempt to keep away from debt debacles of their respective recessions.

“I’d not be stunned to see commodity pushed economies desirous to go to gold due to an absence of higher options,” Steen Jakobsen, chief funding officer at Saxo, advised CNBC’s “Squawk Field Europe” on Dec. 6.

“I feel gold goes to fly,” he added.

Whereas analysts expect a rise within the worth of gold in 2023, a surge of that magnitude is unlikely, in response to international commodities intelligence firm CRU.

“Our worth expectations are way more average,” Kirill Kirilenko, a senior analyst at CRU, advised CNBC.

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“A much less hawkish Fed is more likely to result in a weaker USD, which might in flip give gold bulls extra respiration house and power to stage a rally subsequent yr, lifting costs nearer to $1,900 per ounce,” he mentioned. 

Kirilenko highlighted, nevertheless, that it is all depending on strikes by the Federal Reserve. “Any trace of accelerating ‘hawkishness’ from the US central financial institution would probably stress gold costs decrease,” he mentioned.

Britain will vote to un-Brexit

The “outrageous prediction” most certainly to happen subsequent yr, in response to Saxo’s Jakobsen, is for there to be one other referendum on Brexit.

“I truly suppose it is one of many issues that can have a excessive chance,” he advised CNBC.

Saxo Market Strategist Jessica Amir mentioned British Prime Minister Rishi Sunak and his Finance Minister Jeremy Hunt might take Conservative Get together rankings to “unheard-of lows” as their “brutal fiscal programme throws the UK right into a crushing recession.” 

This, the financial institution forecasted, might immediate the English and Welsh public to rethink the Brexit vote, with youthful voters main the way in which, and pressure Sunak to name a common election.

Saxo predicts there might be one other Brexit referendum on the playing cards for Britain.

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Saxo’s Amir mentioned the opposition Labour social gathering might then win the election and promise a referendum to reverse Brexit for Nov. 1, with the “re-join” vote profitable.

“Enterprise individuals are saying the one factor they’ve gained from Brexit is U.Ok-specific GDPR,” Saxo’s Jakobsen advised CNBC. “The remainder is simply elevated pink tape,” he mentioned.

Anand Menon, director of the suppose tank UK in a altering Europe, mentioned this prediction “simply would not compute.”

“I do not suppose there might be one other referendum and the concept that [Labour leader Keir] Starmer would undertake that place is for the birds,” he mentioned.

Starmer advised a enterprise convention in September that his social gathering would “make Brexit work.”

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Public sentiment towards Brexit has modified because the referendum, Menon mentioned, after the vote resulted in a slim majority of 52% of voters opting to go away the EU again in 2016.

“It is completely the case that public opinion appears to be turning,” he mentioned. 

Analysis carried out by YouGov in November confirmed 59% of the 6,174 folks surveyed thought Brexit had gone “pretty badly” or “very badly” because the finish of 2020, whereas solely 2% mentioned it had gone “very nicely.”

Meat manufacturing to be banned

Meat is answerable for 57% of emissions from meals manufacturing, in response to analysis printed by Nature Meals, and with international locations the world over having made net-zero commitments, Saxo says it’s attainable at the least one nation might reduce out meat manufacturing solely.

One nation “seeking to front-run others” on its local weather credentials might determine to closely tax meat from 2025 and will ban all domestically produced stay animal-sourced meat solely by 2030, Saxo Market Strategist Charu Chanana mentioned.

Meat is answerable for 57% of emissions from meals manufacturing, in response to analysis printed by Nature Meals.

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“I would not be stunned to see faculties in Denmark and Sweden banning meat altogether, it is undoubtedly going that manner,” Saxo’s Jakobsen advised CNBC. “It sounds loopy for us outdated folks,” he added.

The U.Ok., international locations within the European Union, Japan and Canada are among the many nations with legally binding net-zero pledges.

The U.Ok’s Division for Surroundings Meals and Rural Agriculture mentioned there have been “no plans” to introduce a meat tax or ban meat manufacturing when contacted by CNBC.

An eventful 2023?

A few of the different “outrageous predictions” for subsequent yr from Saxo embrace the resignation of French President Emmanuel Macron, Japan pegging the yen to the U.S. greenback at a charge of 200 and the formation of a united European Union navy.

The predictions ought to all be taken with a pinch of salt, nevertheless. Saxo’s Jakobsen advised CNBC that there was a 5-10% probability of every forecast coming true.

The financial institution has made a set of “outrageous predictions” every year for the final decade and a few have truly come true — or at the least come shut.

In 2015, Saxo forecasted that the U.Ok. would vote to go away the European Union following a United Kingdom Independence Get together landslide, it predicted Germany would enter a recession in 2019 – which the nation narrowly prevented – and it wagered that bitcoin would expertise a meteoric rally in 2017.

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