Art market

The market looks vulnerable as the summer break begins

As a busy, but thinner, season draws to a close in the wake of Brexit, uncertainty is the order of the day

The UK’s decision in its referendum on 23 June to leave the European Union piles uncertainty onto an already fragile art market.

Exactly what its impact will be is the great unknown, and great unknowns do not sit well. The immediate effect of the devalued currency reportedly hastened some sales—the Old Masters dealer Johnny van Haeften told us that he sold three paintings “almost certainly due to the fall in sterling”—but supply is a concern longer-term.

Meanwhile, the major auction houses and bigger-league dealers kept calm and carried on. It would be a bit much to expect them to undermine the confidence that supports their market. The “business-as-usual” attitude carried an increased urgency as the Brexit result came in the middle of London’s summer season. (A week of auctions and the Masterpiece London fair were yet to happen as we went to press.)

Some of the market’s minds tried to put forward the view that, in times of uncertainty, art is a financially safe haven, but this has never been a convincing argument while stock markets plummet; £200bn was wiped off the UK’s exchanges by 9am on 24 June.

More realistically, and as the commentator and dealer Bendor Grosvenor writes in this newspaper, “people only buy art when the world is a prosperous and stable place”.

With pre-Brexit uncertainties also looming large (lest we forget China’s debt levels and November’s US election), prosperous and stable seem far off.