Alicia García Herrero (Natixis) | This has not been an easy year despite the strong fiscal and monetary support to Covid-struck economies, especially in the Western world. Such support has allowed the North American and European economies to grow above potential amid repeated waves of Covid-19 and related mobility restrictions even if less severe than in 2020. On the other hand, the emerging world has grown below potential this year…
Ben Krishna (The Conversation) | Herein lies the most probable future for this virus. Even if it behaves like a professional gamer and eventually maxes out all its stats, there is no reason to think that it won’t be controlled and cleared by the immune system. The mutations that improve its spreading ability do not greatly increase deaths. This maxed-out virus would then simply mutate randomly, changing enough over time to become unrecognisable to the immune system’s adapted defences, allowing waves of reinfection.
Julian Marx (Flossbach Von Storch) | Almost two years have passed since the outbreak of the pandemic and economic output in the Eurozone is still below pre-crisis levels, unlike in the US.The ECB envisages a more cautious monetary policy than the dollar bloc (Australia, Canada and the US): real economic output in the US in calendar year 2021 should already be a good two percent above that of 2019. In the eurozone, on the other hand, the statistics for 2021 will probably remain in some cases significantly below the pre-crisis level.
J.P. Marín Arrese | Charles Dickens opens his novel by describing the contrast between the sedate life in London and the bloody spasms shaking Paris under the Revolution with the famous sentence: ‘It was the best of times, it was the worst of times…’. While the current economic scenario bears little in common with the dramatic events described by the prominent author, we enjoy a robust recovery but face an…
Oliver Matikainen | Finance has always been a key issue at the UN’s Conferences of the Parties, and a sticky one at that. In this sense, COP26, held in Glasgow, Scotland, in November, was no different. Climate finance is key because it cuts across all other issues. One of the big things to come out of COP26 was the Glasgow Financial Alliance for Net Zero, that aims to align private capital with science-based targets to finance the investment in a net-zero economy.
Renta 4 | Amazon has launched AWS private 5G, a solution for building private 5G networks with a focus on the corporate customer. One of the most attractive businesses for telecoms with the launch of 5G is expected to be the creation of private telecoms networks for corporate customers. For example, in Germany, states have set aside frequencies for the exclusive use of companies.
Kent Matthews ( The Conversation) | Growth in China was in fact declining well before the pandemic struck: from a peak of 15% in the second quarter of 2007 to 6% in the first three months of 2019. The nation’s growth strategy rests on four pillars. Three are frequently talked about – infrastructure, exports and consumers – while the fourth is only whispered in official circles – and that is the property sector.
Mark Holman (Vontobel AM) | The Fed’s QE programme of $80bn in Treasuries and $40bn of mortgage-backed securities (MBS) purchases per month is already being tapered with $10bn less in Treasuries and $5bn less in MBS as each month passes. In our opinion the Fed should have already finished tapering by now, but they have only just begun and at a very slow pace, suggesting it will take seven further policy meetings to complete.
Alicia García Herrero (Natixis) | The PBoC cut the Required Reserve Ratio (RRR) by 0.5 percentage points yesterday, amid the economic slowdown. This should not surprise us, as China is in the midst of a cyclical slowdown. However, the move has happened when China’s PPI and CPI have just edged up to 13.5% and 1.5% from 10.7% and 0.7% respectively in November. The message to the market is clear: avoiding…
Andrew Fraser (Aberdeen Standards) | They talk, but they don’t do,’ this is how the Queen expressed her frustration with world leaders on the eve of COP26. The same accusation could be levelled at the world’s major banks. They finance the world’s largest companies and have a huge role to play in halting climate change. But the opportunity has yet to be fully grasped. Banks could take a major part…