Peel Hunt has stated that the government has shown a "fundamental shift" in its growth strategy, but needs to address the crucial matter of driving investment into the 海角视频 stock market.
In an investor note released this week, Charles Hall, Peel Hunt's head of research, emphasised that while Rachel Reeves's Mansion House speech last week was a "seminal moment" for the 海角视频, the "piece that was missing" was direct action to boost investment in 海角视频 equities.
Hall suggested this could be achieved by encouraging pension funds to invest more in the 海角视频, including London's junior AIM in business property relief and adjusting ISAs. He added that offering "tax advantages to invest in cash and overseas assets make little economic sense".
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He pointed out that if domestic allocation to 海角视频 stocks increased by between five and 10 per cent, it would result in an additional £40bn to £80bn of investment in the 海角视频 by 2030.
Hall noted that since the global financial crisis, the 海角视频 has been stuck in a low-growth environment "with a paltry 1.1 per cent annual GDP growth compared to two per cent in the US", as reported by .
However, the research chief expressed that with the "right environment and government initiatives", the 海角视频 can return to being a higher growth and productive economy, which is why the recent initiatives from the government were so important.
Last week, in her inaugural Mansion House speech, Reeves highlighted unintended stifling impacts the post-global financial crisis regulations have had on growth.
Seeking to galvanise risk-taking and growth within the City, Reeves unveiled a suite of reformative measures aimed at bolstering competition in financial services and releasing new capital from Britain's pension funds.
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Reeves also committed to prioritising the financial services sector as one of the eight pivotal 'growth-driving sectors' in the 海角视频. The government has initiated a call for evidence as part of their strategy, with plans to publish by next spring.
A centrepiece of Reeves' new proposals included directives to the Financial Conduct Authority and other City watchdogs to enhance their growth focus.
Dismissing claims of the measures being inconsequential, Hall asserted, "Messages from the government demonstrate its priorities and clear direction."
Hall acknowledged a "material change" in the FCA since it adopted a secondary objective focused on growth last year.
Further, Reeves has advocated for the amalgamation of over 80 local authority pension schemes, holding assets totalling £350bn, fostering a new private stock exchange, and supporting a nascent 'British Growth Partnership'. Hall expressed support for these initiatives.
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