Your Guide to Finding Investment Income

SPECIAL REPORT: In our annual guide to investing for income, Morningstar rounds up the great and the good to offer their tips on where to find yield

Emma Wall 13 February, 2017 | 9:27AM
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Income investors looked hopeful this time last year. In our annual guide to investing for income, the outlook last February was positive. The Federal Reserve had raised interest rates in December – the first time in seven year, and was promising several more rate hikes through 2016, and the Bank of England looked set to follow.

But then the unexpected happened and Britain voted to leave the European Union, sending the pound plunging and the Bank into damage limitation mode. As a result, instead of Mark Carney delivering longed-for rate rises to UK savers and investors, the Bank of England base rate was cut to and even lower record level of 0.25%. The best selling easy access savings account is now offering just 1.1% – while the 10 year gilt yield is down to 1.29%.

Low rates are just about palatable in a world of stagflation, but thanks to rising oil prices Britain’s prices are rising – just look at the recent announcements from energy providers ready to increase customer tariffs. The most recent Consumer Price Index, the official measure of inflation in the UK sits at 1.6% for December – and this week we expect to hear January’s measure is even higher.

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The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

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Emma Wall  is former Senior International Editor for Morningstar

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