Although President-elect Joe Biden has made the war against coronavirus his focus, the need for new lockdown measures is being challenged by experts. As soon as Joe Biden was elected, epidemiologist Michael Osterholm, a member of the new health task force set up, told the Washington Post that it would take 4 to 6 weeks of nationwide lockdown in the United States to monitor the progression of the virus, but added that feasibility of a nationwide lockdown seemed impossible.
On today’s macro-economic front the U.S. consumer confidence preliminary index, as calculated by the University of Michigan, declined from a local consensus of 82 in November to 77, and from 81.8 in October. Furthermore the producer price index increased on a month-on-month basis by 0.3 percent in October, compared to a forecast of 0.2 percent. It only rises by 0.5 percent in a year. This time, except food and resources, the PPI increased on a month-on-month basis by 0.1 percent (up by 0.2 percent consensus) and by 1.1 percent year-on-year.
The flash European GDP of the third quarter disappointed a little on Friday morning in Europe, with growth at a rate of 12.6 percent against a consensus of 12.7 percent. The estimates for jobs and the European trade deficit, on the other hand, have been positively shocking.
Also the two central banks leaders were cautious on Thursday. Both, the Fed’s head Jerome Powell and ECB’s chief Christine Lagarde, have already indicated that in the face of a relapse in operation, they are ready to increase monetary support to the US and European economies, particularly in Europe, where replenishment measures are increasing fears of a further recession in the fourth quarter. Therefore the financial markets are more in the full interest of central banks, especially as they now question Washington’s big new fiscal support plan, given the difficult transition between Donald Trump and Joe Biden, and the possible split of the future Congress.