Easy does it

Posted by: Paul Donovan

05 May 2020

Daily update

  • Further lockdown restrictions are being eased. Hong Kong has announced some further changes. In the US, California is to allow some shops to reopen (with conditions). Just to make life confusing, some Californian counties will be able to accelerate the lifting of lockdown. Spain's main opposition party has said that it will not support an extension of the state of emergency (there is a vote tomorrow), which may raises fears of less orderly easing.
  • The UK has announced that around 20% of jobs have been placed on furlough (double counting means that will be less than 20% of workers). This does not mean 20% of GDP has been lost. If workers on furlough are from lower productivity sectors, the impact on GDP will be less.
  • Argentina's finance minister has suggested the country may contemplate a sovereign default (this would be its ninth), after talks with creditors broke down. The deadline for a deal is 22 May.
  • The German constitutional court rules on the legality (under German law) of ECB bond buying. The ECB is not governed by German law. The Bundesbank is. The US ISM non-manufacturing survey is due. Why anyone is bothering to attempt to publish this is a mystery.

Explore more CIO Daily Updates