SSGA: Lessons from recovering countries
SSGA: Lessons from recovering countries
By Amlan Roy, Head of Global Macro Policy Research at State Street Global Advisors
“In addition to the fiscal measures that are already in the pipeline to directly support disadvantaged households, workers and small businesses, the People’s Bank of China, Bank of Korea and Monetary Authority of Singapore have signalled further steps to help strengthen the economy. Coordinated fiscal and monetary policy is needed alongside good news on the public health front. The frustrated calls from doctors and nurses started in China but they still echo around Italy, Spain, the UK and the US. Announcing relief is like announcing a rescue, but until the rescue is tangible it’s the rescue that never comes."
“Evidence from Korea, China, Singapore and Japan should warn us that second round outbreaks need to be mitigated. With oil at an all-time low in the futures market, high credit default swap (CDS) spreads and high levels of volatility measured on both the Volatility Index (VIX) and MOVE index, there is still little confidence of a turnaround – but perhaps we’re not far off the bottom. Sector bets and some risk limited moves would be welcome at the quarter-end rebalancing.”