Britain’s economy has been taking a battering of late with high inflation, increasing interest rates and predictions of a recession. Bu whisky, it seems, is rather resistant to economic troubles.
This is not so much a domestic phenomenon along the lines of the ‘lipstick effect’, where consumers reigning in spending go for smaller treats over expensive indulgences. Rather, the New York Times reports, the recent weakness of Sterling has helped exports of whisky, which enjoyed a 10.5 per cent rise in overseas sales in the year to July.
However, it is not all about the relative value of the pound against other currencies, but changing consumer tastes around the world, not least as advertising campaigns in countries like the US have increased whisky’s appeal to younger consumers.
Reflecting on this, the chief executive of James Eadie Rupert Patrick told the paper: “I think we’ve thrown off a few of the old stereotypes about Scotch, which has definitely helped in some markets.”
That second factor may be more significant in the future. If a broader range of consumers takes an interest in the drink, whisky investment may be taken up by more people and also at a younger profile, meaning some might invest young and enjoy the proceeds of their investment many years hence when its value has soared.
Indeed, the potential for whisky to offer a major return might be especially tempting if the market is growing because that offers long-term promise, at a time when many investors might be shying away from short-term options due to the economic turbulence being felt in the UK and many other countries.
The current maelstrom in Britain hasn’t all been good news for the whisky sector, with the unravelling of the September 23rd mini-Budget meaning the freeze on alcohol duty has been abandoned, a move that has predictably not proved popular among distillers.
However, with a growing and younger international market for Scotch, the conditions are still right for whisky to establish itself for a generation, increasing the prospects for whisky investors to get a great return in the years ahead.