It is a new week in the financial markets, and one where investors will keep their eyes on central banks around the world. There will be policy meetings held by the Federal Reserve in the United States, the Bank of England, and the Bank of Japan.
Today US Treasury Secretary Janet Yellen stated that the government is not overly concerned with inflation at the moment and that the Treasury does not expect it to increase beyond control. This is very much in line with what Fed Chairman Jerome Powell has been saying at all of his public meetings, so the overall likelihood of hawkishness in the US is low, despite improving fundamentals.
In the meantime, bond yields have continued to increase, especially (but not only) in the United States. The dollar remains strong due to this, which in turn is raising concerns regarding emerging markets, where there is a lot of public debt in dollars. Brazil, Russia, and Turkey (which experienced a currency crash a few years ago when the dollar strengthened quickly) will also have central bank meetings this week which are worthy of attention.
This morning the markets were also pleased over economic data from China, where YoY markets have improved massively in 2021 compared to the lockdown-ridden China of winter 2020. Any improvement in the second largest economy in the world has a positive impact on investor sentiment and risk appetite in particular.
In the context of all of the above-mentioned developments, it is hardly surprising that today US stock indices are rallying. In addition, Bitcoin surpassed the $60,000 mark.
In other news, Europe’s spat with AstraZeneca continues. To date, there have been at least 15 cases of people developing and even dying from blood clots that they developed soon after receiving the AstraZeneca Covid-19 vaccine. This prompted several European countries to suspend use of the drug last week, slowing down the already sluggish vaccination process in the EU.
While the cases are still being investigated nationally and by the World Health Organization, AstraZeneca has come forward to state that the registered blood clots are an insignificant number compared to the 17 million administered vaccines.
Blood clots are a health issue that occurs naturally in the population even without the introduction of any sort of medication, and AstraZeneca has maintained that its vaccine is not causing it. Blood clots were also not among the side effects that appeared during the clinical trials of the drug and that are officially associated with it.
Even as EU countries are split on whether to resume using the AstraZeneca shots, the bloc is also negotiating for more jabs from the company to be delivered. AstraZeneca is well behind schedule on supplying vaccines to the EU. Meanwhile, its vaccine is still not approved for use in the United States, so European countries have asked for deliveries to be made from the US of the vaccines that are not being used there.
