The UK has seen a broad mix of economic news in 2023, making selecting the best UK shares to buy next month somewhat of a challenge. Three key factors are having an outsized influence over UK companies’ performance.

First, CPI inflation has increased from 10.1% in February to 10.4% in March, which is higher than most analysts expected. With the base rate already at 4.25%, the markets are pricing in an increase to 5% — and if inflation remains stickier than expected, further increases cannot be ruled out. For context, the Office for Budget Responsibility predicts a drop in inflation to 2.9% by the end of the year, but this is just seven months away.

Second, the UK’s tax burden — both personal and business — is at its highest level since World War II. Larger corporations are facing a toxic cocktail of higher taxes, including an increase in corporation tax from 19% to 25% and the end of the popular super-deduction tax break.

These changes are starting to impact the decision-making of the country's largest firms, with many — including ARM, AstraZeneca, CRH, and Flutter — looking wistfully at US stock exchanges or moving some operations abroad due to uncompetitive taxation policies. Many respected bodies are now predicting that the UK will experience low growth through 2023 — and this can become self-fulfilling prophecy.

Third, several of the UK’s most prominent business leaders are speaking up. Legal & General CEO Nigel Wilson recently referred to the UK as a 'low growth, low productivity, low wage economy,' and Marks & Spencer CEO Stuart Machin believes that London is on 'life support' following the removal of tax-free shopping for foreign tourists.

These three factors all point to the same problem: any substantial domestic growth will be difficult to achieve in the near-term and will stoke the inflationary fire if achieved. This is of course, not optimal.

However, where there’s negative sentiment, a value investor sees opportunity.

Best UK shares to buy

1. Antofagasta (LON: ANTO)

Antofagasta is a copper-focused miner that is not as popular among investors as some of its more diversified peers on the FTSE 100. However, the growing supply gap in the copper market could boost its prospects significantly in the second half of this year and beyond.

Copper has been identified as the most critical metal globally by Trafigura co-head Kostas Bintas due to a shortage in the market, with only 3.5 days of copper stock equivalent available at the end of last year.

Total copper production fell by over 10% to 646,200 tonnes due to droughts and pipeline leaks at its Chilean operations last year, while lower copper prices led to a 26% decrease in pre-tax profit overall.

This underperformance has seen Antofagasta's share price slip by 7.4% year-to-date.

However, this dip could present a lucrative opportunity for long-term investors looking to take advantage of the expected long-term surge in copper prices. Copper's significant role in global electrification, sustainable energy production, and infrastructure projects should ensure robust demand for the metal.

As the world transitions towards renewable energy sources and electric vehicles, the need for copper is expected to rise further. Arguably, ANTO is the best UK share to buy for exposure to this trend.

2. Legal & General (LON: LGEN)

Legal & General has experienced a 7.4% decline in its shares over the past year to 234p. However, just like Antofagasta, this could be a buying opportunity for investors. The FTSE 100 company, famous for paying out reliable dividends year after year, now boasts a dividend yield of 8.3%, far exceeding the index average. And the company recently increased its full-year dividend by 5% to 19.37p.

In the recent FY22 results, LGEN reported a 12% increase in operating profit to over £2.5 billion, amid a return on equity of 20.7%. The company's Solvency II coverage ratio, an essential metric for the insurance industry, stood at 240% at the beginning of March, an impressive increase from 187% in the previous year.

Wilson — who leaves this year — has continually highlighted the company's diversified and synergistic business model as the key factor behind its continued success. LGEN is well-positioned to benefit from aging populations in its key markets, particularly as more people start to need the company's pensions, annuities, and equity release products.

Overall, LGEN's strong brand recognition, robust financials, and favourable market trends make it an attractive investment opportunity for those seeking a reliable UK company for their portfolio next month.

3. JD Wetherspoon (LON: JDW)

JD Wetherspoon, the FTSE 250 pub operator, has experienced a 60% surge in shares year-to-date, which are currently trading at 724p. For context, the company's like-for-like sales in the most recent half increased by 5% when compared to H1 2019 pre-pandemic figures and by 13% compared to H1 2022.

Pre-tax profit of £4.6 million, while lower than the £50.3 million profit reported in 2019, is a notable improvement from the £26.1 million loss of 2022. The company has also reported a decrease in net debt by £176.5 million to £743.9 million, which is likely to have helped in rebuilding the confidence of the company’s investors.

Naturally, rising inflation and the crippling cost of living crisis is creating a war on two fronts for the company — profitability is being impacted by increasing labour and stock costs, while customer spend is being squeezed by increased essential bills. The company has a fine line to toe — as it has the opportunity to increase market share as customers seek cheaper offerings, but is already operating on wafer-thin margins.

Moreover, CEO Tim Martin remains ‘cautiously optimistic’ about the budget pub operator’s near-term prospects, particularly in light of the traditionally busier summer season. Further, Martin’s campaign for VAT tax parity with supermarkets may find some political sympathy as the industry is weaned off energy bill support.