Recent downgrades to the CBI’s UK GDP growth forecasts — to 1.2% in 2025, and just 1.0% in 2026 — signal more than just a cyclical slowdown.
They point to a deeper structural shift in the business environment. For internationally exposed firms, this isn’t just a domestic issue.
Slower UK growth prospects translate into lower investor confidence and strategic repositioning across global operations message is clear: rethink, refocus, and build for resilience.
Trade friction with the US is a wake-up call, and today’s signing of a bare-bones trade deal has done little to alter that fact. Indeed, with tariffs reinstated on steel and aluminium despite earlier negotiation achievements— and UK exports to the US already down 9% year-on-year — we’re seeing clients accelerate diversification into alternative markets. That shift brings new currency exposures. For some, it means restructuring supply chains; for others, it means relocating operational hubs out of dollar-dominant regions altogether.
We’ve seen a marked uptick in clients using our multi-currency account solutions to unlock pay-in and pay-out capabilities in new markets and currencies, and proactively adapting their currency risk strategies alongside. They’re no longer waiting for volatility to hit — they’re anticipating it.
Inflation risks have re-emerged after CPI data jumped to 3.4% year-on-year in both April and May – more than a percentage point above the Bank of England’s 2.0% target. While rate cuts may be on the horizon, key figures at the Bank of England have emphasised that they’re likely to be both gradual and conservative given the risks. In the meantime, firms are operating in a persistently high-cost debt environment. That calls for forward-looking liquidity planning and early refinancing — particularly for companies carrying legacy debt or exposed to rate resets.
Fiscal policy risk is often overlooked, but right now, it’s critical. A projected £20 billion shortfall in future tax and spend plans means the government will have limited fiscal headroom. Reliefs, incentives, and R&D schemes could face significant restructuring as pressures mount to balance the books and avoid the ire of bond markets. They are already skittish about the UK’s tax and spending splurge, with UK government debt currently priced at a premium compared to its rich-world peers.
That uncertainty should be factored into long-term strategic planning now.
Labour tightness amid skills shortages in key industries continues to constrain growth, but higher wages alone won’t solve this. Businesses need scalable systems, automation, and workforce strategies aligned to future demand, not just today’s gaps.
The US’s scattershot approach to international relations, along with recent flare-ups in the Middle East, means that there’s no question that global supply chains remain vulnerable — but for currency-exposed businesses, that volatility isn’t just risk. It’s an opportunity.
With the right FX strategy, firms can turn fluctuations into a competitive edge. In this environment, agility is everything.
At Bondford, we help private capital firms and corporates build that agility — with multi-currency account solutions, institutional-grade FX execution, and bespoke currency risk strategies that treat hedging not as a cost centre, but as a source of strategic advantage.
Our message to clients? Act now. In today’s market, the difference between staying afloat and pulling ahead comes down to one thing: strategy.
