Investment Newsletter – November 2021
According to Global Times, in response to such complicated and widespread outbreaks, local governments have adopted strict measures to curb the spread, with “zero-transmission policy”. On the other hand, the two main reasons the WHO’s Kluge gave for Europe’s soaring case numbers were insufficient vaccination coverage and the relaxation of public health and social measures.
US Fed is grappling with the danger of higher prices and lower growth. US GDP increased at just a 2% annualized pace in the third quarter, the slowest since the recovery began off a recession that ended in April 2020. Yet, annual inflation rose at its fastest pace in more than 30 years during September despite a decline in personal income.
Government bond yield curves have been flattening all over the world as central banks are expected to move toward ending the era of loose-monetary policy put in place at the beginning of the pandemic. Expectations of sooner-than-expected rate increases have pushed short-term yields higher in recent days. Longer-term ones have fallen in part due to bets that a potentially more hawkish rate policy will successfully tamp down inflation. The latest dot plot highlights expectations that we could see rates really pick up in 2023. However, there are many that expect to see rates rise next year in 2022.
