Supported by fiscal stimulus expectations, the 10-year T-Bond yield increased by a further 4 basis points to hit 1.1260% on Friday, the highest since March 2020, up from 0.9% at the beginning of the week. On Friday, the dollar index rebounded by 0.35% to 90.14 points, while the euro gave up 0.38% to $1.2224.
Capital markets continue to bet on the progress of the Covid-19 vaccine programs and are expecting a large economy-supporting Biden program. In Europe and the United States, meanwhile, coronavirus accelerates (more than 4,000 deaths within 24 hours) and has also reappeared in China. A condition that resulted in the loss of 140,000 jobs in the United States in December, the first decrease after 7 months of job growth. Investors are now watching a Congressional debate that could vote on the impeachment of Donald Trump by the completion of his term on January 20.
According to U.S. media outlets, in addition to the $600 currently offered in the minimum package implemented just before Christmas, President-elect Joe Biden is planning a large funding initiative that provides additional direct aid to Americans, amounting to $1,400. Also, a massive $3,000 billion ‘package’ involving significant development work, including green transformation, is currently being planned by the Biden administration. 140,000 jobs were lost in the United States in December.
On the disease front, both in the United States and in the United Kingdom, the crisis is deteriorating, while continental Europe continues to improve its restriction steps (containment, curfews, closures of publicly-receiving establishments) to stem the dissemination of the current coronavirus strain from the United Kingdom, which is proving to be even more bogus.
A milestone of more than 4,000 casualties in 24 hours was hit on Thursday in the United States (where the new variant has already been detected), taking the cumulative number of fatalities to over 366,000, with 21.6 million confirmed cases. The discovery of new cases of Covid in China, where the disease appeared to be almost extinct in recent months, has led to the confinement of Shijiazhuang, the capital of the province of Heibei (not far from Beijing), which has a population of 11 million, since Thursday.
London Mayor Sadiq Khan has sounded the alarm in the UK, where a new complete containment is in effect until at least mid-February, by calling the crisis ‘serious’ in London hospitals, where the outbreak is ‘out of balance.’