2020 didn’t go the way we all expected. David Coombs has tossed out his old fortune-telling teacup and reached for the magic 8-ball this year.
Their policies could end up boosting growth, though companies may get a smaller slice
Financial markets have been on a rollercoaster over the past year. There was a sharp drop in March as countries locked down and then a swift upswing followed, led by technology shares. Even unloved companies, particularly banks and energy firms, have rebounded lately, thanks to good news about vaccines.
Rather than try to reduce it by austerity, inflation or default, the government should focus on keeping the rate of economic growth above the cost of servicing the debt.
As COVID-19 continues to affect our lives and influence economic activity around the world, there’s lots of uncertainty about what the future holds. Localised outbreaks and lockdowns are possible anywhere until a vaccine is found, with the level of unemployment likely to be the key factor driving the pace of the recovery over the next couple of years.
Depending on what lens you choose, the value of equities can vary widely. We’ve looked through as many as we can, and we’re maintaining a vigilant optimism.
Confusion reigns because of the sheer amount of information flying around us. Yet all that activity should bring us comfort as it's helping fight the pandemic and its economic effects, argues head of fixed income Bryn Jones.