A gloomy end of the year

The extremely rapid spread of the Omicron variant has led the Dutch government to declare a return to lockdown. The British authorities are also openly raising this possibility, especially since the Astrazeneca vaccine has been shown to be significantly less effective than messenger RNA vaccines against this variant according to several studies. 

In the United States, Democratic Senator Joe Manchin suddenly announced that he would not vote on Biden’s plans for higher social spending and taxes after months of negotiations. Goldman Sachs immediately downgraded its growth forecast for the US economy. 

In the wake of the fall in their reserve rate, Chinese banks reduced their 1-year lending rate from 3.85% to 3.80%. This is the first drop since April 2020. While this confirms the Chinese authorities’ willingness to support activity, it also underlines the extent of the economic slowdown. 

In this context, the stock markets plunge and long rates fall again. The EUR/USD exchange rate fell back below 1.13, but remains in its recent trading range. Very light economic calendar today as for the rest of the week.

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