Current Events Update:
- * Congress continues discussions over a $900 billion coronavirus relief package.
- * The US reports over 3,600 COVID-19 deaths on December 16, marking a record high.
- * French President tests positive for COVID-19.
- * Moderna’s COVID-19 vaccine is anticipated to receive FDA approval.
- * The Federal Reserve maintains interest rates and commits to additional bond purchases.
- * The Fed increases its economic growth forecast for 2021.
- * US retail sales declined more than anticipated in November.
- * Eurozone consumer prices decreased for the fourth consecutive month.
- * Bitcoin surpassed $23,000, gaining popularity among Wall Street investors.
- * Confidence among home builders dipped in December after reaching a record high.
- * The US economic expansion slowed in December, according to PMI survey results.
The Federal Reserve is anticipated to reaffirm its exceptionally accommodating monetary policy during today’s FOMC meeting, with the futures market reflecting zero probability for any rate hike through 2021. However, signs in real-world government bond trading suggest that a transition away from perpetual zero rates might eventually occur.
Key Political and Economic Updates:
- * GOP Senate Majority Leader McConnell publicly recognizes Joe Biden’s victory.
- * Economists anticipate a decline in today’s report on November retail spending in the US.
- * Congress is still negotiating details for the COVID-19 relief package.
- * Eurozone economy is reportedly “close to stabilizing,” according to PMI survey data for December.
- * December PMI data reflects “ongoing resilience” in Germany’s economy .
- * Japan’s economy continues to contract as reported by PMI data.
- * The UK economy shows slight growth according to December PMI survey data.
- * Will the Fed adjust its bond-buying program in today’s meeting?
- * NY Fed Manufacturing Index for December continues to show moderate growth.
- * US industrial output growth slowed in November, rising just 0.4%.
A bearish sentiment continues to apply pressure to the US Dollar Index, which has seen a significant decline this year. This trend offers a favorable outlook for US investors holding assets in foreign currencies. Additionally, gold and cryptocurrencies—considered alternative forms of “money” not directly tied to the dollar—have also yielded profitable returns this year.
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Significant National Updates:
- * The Electoral College has confirmed Biden as the next US president.
- * Developing nations face a prolonged wait for vaccines.
- * The US COVID-19 death toll surpasses 300,000 as vaccine distribution begins.
- * US Attorney General Bill Barr announced he will step down next week.
- * The FTC has initiated a privacy investigation targeting major tech firms.
- * US tech companies are required to modify their business practices in the EU or face significant penalties.
- * US imports from China show an upward trend.
- * Retail spending and industrial output in China continued to improve in November.
- * UK layoffs reached record numbers in October.
- * Concerns grow regarding a potential zombie recovery for the US economy.
- * The CBOE Market Volatility Index—VIX—has surged to its highest level in over a month.
Commodities, broadly defined, have shown the most significant gains among the major asset classes in last week’s trading, closely followed by robust rallies in global fixed-income markets, as reflected in a variety of ETFs. In contrast, US real estate investment trusts (REITs) faced notable losses by week’s end (Friday, Dec. 11).
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Vaccine Progress and Economic Outlook:
- * The US vaccine rollout has commenced, providing hope for a struggling nation.
- * The Electoral College is set to formally cast its votes for Biden as the next president.
- * Discussions on vaccine rollout are expected to be a key topic at this week’s Fed meeting.
- * EU and UK postpone trade talks but anticipate a no-deal Brexit..
- * Eurozone industrial output increased in October, up 2.1%.
- * The ECB anticipates inflation will remain below its target of nearly 2% for several years.
- * Reports indicate Russian hackers have gained access to US federal agency networks.
- * US consumer sentiment has shown improvement in recent weeks.
- * The policy-sensitive two-year Treasury yield has declined sharply ahead of Wednesday’s Fed meeting:
● Competition is Killing Us: How Big Business is Harming Our Society and Planet – and What To Do About It
Michelle Meagher
Interview with author via Pitchfork Economics
Neoliberal economic principles advocate for unrestricted free trade, but not all trade should be unregulated. Competition law expert Michelle Meagher joins Goldy to dismantle prevalent competition myths and discuss how to hold powerful monopolies accountable.
Latin American Equities Show Strong Performance: Global markets had a mixed performance for the week ending Friday, December 11. However, iShares Latin America 40 (ILF) continues to thrive.
The recent weeks have clearly indicated a deceleration in economic growth due to the resurgence of COVID-19. A significant shift in macroeconomic trends was highlighted in the latest update of the ADS Index, the Philadelphia Fed’s real-time business cycle index.
