Central and eastern Europe will recover next year but output will return to pre-pandemic levels only after 2021 in most cases. Monetary and fiscal stimulus will help the rebound, but higher debt and external risks remain concerns for certain countries.
China,and small businessesMcConnell: Stimulus negotiations in Congress are down to the last few differencesWhere Peer-to-Peer Finance Grabbed Hold This Yearthe U.S. and Vietnam were leading markets for peer-to-peer finance. South Africa and Turkey saw more stablecoin use.Congress strikes historic $900bn Covid relief deal for stimulus checks,unemployment,Nigeria,India.
(Bloomberg) — The pound slid as Britain and the European Union blew through another deadline on Brexit negotiations and the U.K.s coronavirus situation worsened, while progress on U.S. fiscal stimulus dented appetite for haven currencies like the Japanese yen and Swiss franc.Sterling dropped in Asia-Pacific trading as it became clear that talks between the U.K. and EU would continue past Sunday — which had been established as a deadline — and after Prime Minister Boris Johnson detailed new virus-related restrictions for London and southeast England. Talks between the U.K. and EU will resume on Monday with few signs that either is ready to the U.S., Congressional leaders said they have agreed on the terms of a roughly $900 billion plan to help the U.S. economy weather the coronavirus pandemic, though the legislation is still being written and the House and Senate wont vote on it until Monday. Virus concerns were also at the forefront in Australia, with a renewed outbreak in Sydney weighing on the local currency.Prospects of a U.S. fiscal deal getting off the ground are helping contain some of the pessimism, as are hopes that a Brexit deal can be reached before Christmas, but it feels like we are on a bit of a knife edge here as we turn into the home straight for Christmas, said David Croy, a Wellington-based strategist at Australia & New Zealand Banking Group. Amid thin liquidity conditions, expect more volatility.Key Currency MovesThe pound dropped as much as 0.9% to a near one-week low of $1.3395, with selling accelerating below the Dec. 16 low of $1.3435, as traders executed sell-stops on behalf of funds, according to a trader familiar with the matter who declined to be identifiedThe dollar rose 0.1% to 103.50 yen and 0.2% against the franc to 0.8856 per dollarThe euro rose against the pound, but was lower versus the U.S. currency by 0.3%The Aussie dollar slipped as much as 0.5% to 75.84 U.S. centsOut of ControlIn Europe, Britain is very much at the center of concerns about the coronavirus, with many countries taking steps to limit travel with the U.K., including France, Italy, Germany, Austria and Belgium. More than 16 million Britons are now required to stay at home as a full lockdown came into force Sunday in London and southeast England, part of Prime Minister Johnsons effort to contain an out of control new strain of the coronavirus.On Brexit, meanwhile, market participants have become hardened by countless missed deadlines and last-minute talks over recent years. Banks including RBC Europe Ltd., Nomura International Plc and Citigroup Global Markets Ltd. were already focused on the end of the year as the real make-or-break moment.Sticking PointOne major sticking point is access to the U.K.s water for fishing. The fishing industry accounts for just 0.1% of U.K. gross domestic product, but is of high political significance, with Johnsons government seeing it as a symbol of national sovereignty.If a trade agreement isnt struck by the end of the month, decades of free movement of goods, services, people and capital will come to an abrupt end. British firms would revert to trading with the EU under rules established by the World Trade Organization.That means imports and exports to the EU would be subject to WTO-negotiated tariffs — essentially a tax on goods. The pound could fall to $1.25 by the middle of next year if no trade agreement is agreed, according to analysts in a Bloomberg survey.U.S. StimulusAcross the Atlantic, Congress will pass a one-day temporary extension of government funding to avoid a partial shutdown of federal agencies before the package is voted on and signed into law.It plans to combine the virus-related measures with $1.4 trillion in government spending for fiscal year 2021. The government is currently operating under a stopgap spending measure that expires at midnight on Sunday.(Adds agreement on stimulus, updates prices throughout.)For more articles like this, please visit us at Subscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.