- Globally there were over 85 million confirmed Covid-19 cases at the start of January and over 20 million in the United States alone.
- Democrat wins in the Georgia runoff election will give the incoming Biden administration more flexibility with economic policy and the structure of further stimulus.
- Stricter lockdown measures were implemented throughout Europe, including the move to tier 5 restrictions in England as the UK prepares for its vaccine rollout.
- US-China relations deteriorated as the US began enforcing new visa restrictions on Chinese party officials and investment bans on companies with Chinese military links.
- The RBA minutes for the December meeting revealed the board believes it will take some time for output in Australia to reach its pre-pandemic level.
The global economy continues to recover as investors weigh the impact of further lockdowns against the optimism of vaccine rollouts and fiscal support.
A projected victory in the two Georgia Senate runoff elections has handed Democrats control of Congress and the White House, raising the prospect of higher taxes and big spending on a third coronavirus package.
The UK has been inoculating people with the Pfizer vaccine on an emergency basis and became the first country in the world to start deploying the AstraZeneca vaccine.
The Chinese economy continues to power along. Industrial production improved 0.1% to an annual rate of 7.0% in November and in line with expectations, boosted by fiscal stimulus measures, while year-on-year retail sales rose 0.7% to 5.0% (versus 4.4% expected).
Japan’s September quarter GDP was upgraded from an annualised real 21.4% to 22.9%.
NSW is on high alert following a Covid-19 outbreak in Sydney’s Northern Beaches, while a new, more infectious strain of the virus has been identified throughout the country, including four in Victoria and one case of a quarantine hotel worker in Brisbane.
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The information in this Market Update is current as at 12/01/2021 and is prepared by Lonsec Research Pty Ltd ABN 11 151 658 561 AFSL 421445 on behalf of National Australia Bank and its subsidiaries. Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Before making any decisions based on the content of this document, the reader must consider whether it is personally appropriate in light of his or her financial circumstances or should seek independent financial advice on its appropriateness. Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain and read the corresponding Product Disclosure Statement (PDS) and consider the contents of the PDS before making a decision about whether to acquire the product.