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ryanair cabin crew

World economy 29th July 2020

Airlines Shouldn’t Rush To Cut Jobs

Geraint Harvey, Daniel Wintersberger, Peter Turnbull via The ConversationUK | Several airlines have announced sizeable redundancy programmes due to Covid-19 spreading, but previous crises show that there are viable alternatives to job cuts. After the 2008 financial crisis airlines like Southwest adopted different measures including work-sharing, temporary pay cuts and furlough. As a result, they were less likely to experience industrial strife and the business recovered more quickly. 

novavax

World economy 27th July 2020

The Day After The Coronavirus, What’s The Economy Going To Be Like?

Pablo Pardo (Washington) | In March, Maryland-based pharmaceutical company Novavax was trading at 36 dollar cents (32 euro cents). It was a “penny stock”. On July 8th, Novavax closed at $104.56 (92.76 euros). Later they will say that the coronavirus is bad for the economy. What will happen to the price of the pharmaceutical companies on the day when a vaccine against the coronavirus arrives? And what will happen to the excess income arising from the help to the unemployed? And what about the much-trumpeted transformation of supply chains?

negative rates3

World economy 26th July 2020

Negative Interest Rates: Where Is The Real Limit To Cheap Money?

Interest across the globe on using negative rates as a policy tool has increased with global interest rates moving towards zero in the hopes of pulling economies quickly out of the COVID-19 recession. In a report by Citi GPS, analysts Matt King and Catherine L. Mann look at the positives of negative rates in terms of whether they boost credit growth, stimulate spending, or contribute to currency weakness. More importantly, they explore the side effects negative rates would have on corporates, households, banks, pensions, and markets.

Fed's inflation target

World economy 25th July 2020

Central Banks Will Not Regain Their Inflation Targets In The Next Three Years

Central banks have once again received criticism for the support they have provided to markets-to-date and their role as inflation targeters. Analysts at AXA IM’s view is that much of this criticism is misplaced: They expect central banks to remain inflation targeters, even though seeing the immediate pandemic impact as likely disinflationary through 2022. 

corona vaccine 1

World economy 23rd July 2020

The Race For A Vaccine Accelerates: Robust Immune Response From Oxford University-AstraZeneca’s Candidate

AstraZeneca and the University of Oxford have published in The Lancet preliminary results of the Phase I/II trial of their Covid-19 vaccine candidate. In line with last week’s information, it generated an immune response via neutralizing antibodies and T-cells (cellular immunity). As was the case last week when we heard from Moderna and Johnson & Johnson, these are positive developments, bringing us closer to being able to achieve a vaccine against Covid-19

Hong Kong neons

World economy 19th July 2020

Why Hong Kong Will Remain An International Financial Centre, Despite New Security Law

Horace Yeung and Flora Huang via The ConversationUK | Following the introduction of a new Chinese national security law, some are questioning the sustainability of Hong Kong’s position as an international financial centre. These doubts are augmented by China’s plans to transform Hainan, another island off the southern coast of the Chinese mainland, into a free-trade hub. This further calls into question the idea that Hong Kong is irreplaceable for some.

money

World economy 17th July 2020

The US Dollar’s In The Spotlight

We enter the second half of the year with the cases of Covid-19 increasing uncontrollably on the American continent and in a very worrying way in the United States. The growing political uncertainty, accentuated by the trade conflict between US and China, puts the dollar in an unusual situation.Without falling into excessive pessimism, UBS AM Chief Strategist Evan Brown analyses in detail the current state of the currency and reveals his tactical positions given the current scenario.

china WTO

World economy 16th July 2020

China’s Recovery: A TextBook V

Sophie Altermatt (Economist, Julius Baer) | The Chinese economy went through an impressive recovery in the second quarter and grew 3.2% compared with the same period a year ago, demonstrating a textbook V-shaped recovery. The return to growth was led by the production side and was driven by catching-up effects, pent-up demand and government support after the fallout in the first quarter due to the impact of the Covid-19 crisis.

real estate investment trusts in China

World economy 15th July 2020

Chinese Real Estate Market: 2021 Growth As In Pre-Corona Times

Mainfirst |The January outbreak of the coronavirus pandemic in China had a severe impact on the Chinese real estate market, compared to 2019, property sales in February 2020 dropped by 65 percent. The market has now almost recovered from this. This is due to both the special features of the Chinese market and government intervention. Chinese real estate sales have been on the rise since March and April and are now already back to 80 percent of the previous year’s level. 

ECB meetings

World economy 14th July 2020

Is There A Limit To Central Bank Intervention?

Alphavalue | The answer to this complex question is yes. Our analysts believe there is a limit to central bank intervention. This is not determined by economic or financial rules, but by politics. Ignoring that limit would violate democracy. The next question is: have some central banks already crossed the limit?