- The US employment report was probably better than expected (forecast ranges are too wide to know exactly what was expected). A similar pattern is emerging in Europe, with furlough schemes unwinding more rapidly. Normally downturns are caused by imbalances, which damage labor markets for some time. This downturn was more like a light switch being turned off and on.
- This suggests labor markets will continue to improve faster than economic models predict. However, there are structural labor market changes, as the pandemic accelerates the effects of the fourth industrial revolution. Employment is likely to be lower at the end of the year than at the start. Policy should focus on retraining, not trying to block structural changes like home working and online retail.
- In the interminably tedious EU–UK divorce there is news. The Financial Times reports the UK government is considering overriding parts of the withdrawal agreement that Prime Minister Johnson negotiated. This may not be the best signal ahead of attempts to negotiate lots of international trade deals.
- Chinese exports (dollar terms) were strong, signalling the consumer-driven global bounceback is intact. German industrial production was below the forecast range, but (as always with German data these days) the previous month's data numbers were revised stronger.