Auctions Brace for Post-Brexit Week

In retrospect, it looks like extremely poor planning. The London Contemporary sales get overloaded with three Evening sales and a special curated 250th Anniversary sale at Christie’s that will coincide with the confusing aftermath of the UK referendum to pull out of the European Union.

Yesterday’s referendum does not mean the British government is beginning the two-year process to leave the EU (even if the European governments are pushing British leaders to follow through on their popular referendum.) But it does mean the currency markets will be impacted by the uncertainty.

The morning after the vote has already seen the pound drop 8% against the dollar and Euro rose nearly 6% against the pound. That does offer some hope for next week’s sales. Unless there is an unlikely dramatic change in currencies, European and US collectors (or those paying with funds held in Euros or dollars) will have significantly more buying power.

Also, at times of uncertainty, those with cash tend to seek safe haven assets that might better hold value than financial instruments or currencies. We could see strong buying.

The limitation on that is the quality of work on offer in London. Given the overall retreat of public sellers, there simply isn’t a ton of work, let alone great work on offer next week.

Over the weekend, all three auction houses will surely be scrambling to keep consignors (especially non-UK domiciled consignors) from withdrawing lots. It will be very interesting to see the composition of the sales once that process is over.