Highlights:
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Joe Biden is the projected winner of the US presidential election, with the passing of the ‘safe harbour’ deadline making it hard for legal challenges to change the outcome.
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Globally there were over 60 million confirmed Covid-19 cases at the start of December and numbers continue to rise in the US, South America and Europe.
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The UK has begun rolling out the Pfizer-BioNTech vaccine, while Australia and the US are preparing to do the same once the vaccine is approved.
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China has ramped up its trade conflict with Australia, putting tariffs of up to 200% on Australian wine and suspending the importation of Australian beef, barley and timber.
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The Reserve Bank of Australia left the cash rate unchanged at a record low 0.10% and the board expects rates will not increase for at least three years.
Global economies
The global recovery is underway and is looking sufficiently V-shaped, but recent economic news has been mixed. Infection rates have risen in the US and Europe, causing a loss of momentum, but news of successful vaccine trials have boosted confidence. Central bank policy remains extremely accommodative and fiscal spending is supporting jobs and income
US
As coronavirus case numbers continue to rise, additional fiscal stimulus is firmly back on the agenda. A bipartisan group of senators will propose a fresh US$908 billion package, including US$288 billion in small business aid and US$180 billion in unemployment benefits.
Europe
Europe’s recovery has set in, even as the region battles resurgent coronavirus numbers and national governments implement new post-lockdown restrictions ahead of the festive season.
China
China is preparing for a large-scale rollout of its own domestically developed coronavirus vaccines.
Asia Region
Japan’s GDP rebounded by an annualised 21.4% in the September quarter (surpassing expectations of 18.9%) following a revised 28.8% contraction in the prior quarter.
Australia
Australia’s economic recovery has found solid footing, underpinned by low Covid-19 case numbers nationwide and news of successful vaccine trials.
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The information in this Market Update is current as at 12/12/2020 and is prepared by Lonsec Research Pty Ltd ABN 11 151 658 561 AFSL 421445 on behalf of National Australia Bank and its subsidiaries. Any advice in this Market Update has been prepared without taking account of your objectives, financial situation or needs. Before making any decisions based on the content of this document, the reader must consider whether it is personally appropriate in light of his or her financial circumstances or should seek independent financial advice on its appropriateness. Past performance is not a reliable indicator of future performance. Before acquiring a financial product, you should obtain and read the corresponding Product Disclosure Statement (PDS) and consider the contents of the PDS before making a decision about whether to acquire the product.