The governments have started to consider reducing the amount of time people need to isolate themselves with COVID-19. Why, if cases are surging? It is because we are moving from a COVID pandemic to COVID being endemic.
Omicron has swept the UK and once it has the vast majority of people will have been either vaccinated, infected with COVID, or both. However, the peak seems to have now passed. This means that the majority of people have a whole host of antibodies to deal with COVID-19 and future variants are likely to be even less deadly. This is why Bill Gates has recently said that once Omicron has passed Covid will be more like the seasonal flu. People may take a seasonal jab.
China
One tail risk to the latest omicron surge has been China. Will China maintain their Covid-zero policy and shut down whole cities for a relatively small number of cases? The answer seems to be moving to ‘no, they won’t’. According to Bloomberg’s Shuli Ren, “Covid zero” is no longer China’s policy goal. Rather, it’s aiming for “dynamic clearing”, which relies on local governments to stamp out local outbreaks. So, with the winter Olympics just a few weeks away there may be some harsh measures, but once they have cleared then the ‘dynamic clearing narrative’ seems set to stay.
The Fed’s actions
The Fed is now ending QE, hiking rates three times at least this year, and looking at starting QT this year.
The takeaway
The actions are of the governments and central banks unwinding the supportive measures quickly. How can we tell when we are definitely in an endemic phase? Some of the telltale signs are when masks are not as highly required to be worn, self-isolation times are reduced, schools and businesses remain open and the disruptions of 2020 are not implemented.
Our products and commentary provides general advice that do not take into account your personal objectives, financial situation or needs. The content of this website must not be construed as personal advice.
Recommended Content
Editors’ Picks
EUR/USD climbs to daily highs near 1.1180 following the Fed’s decision
EUR/USD now picks up extra pace and revisits the 1.1180 region after the Federal Reserve decided to cut its interest rates by 50 bps at its event on Wednesday.
GBP/USD hits fresh tops near 1.3300 on weaker Dollar
The Greenback is now accelerating its decline following the Fed’s decision to reduce its interest rates, sending GBP/USD to fresh tops in the 1.3290 zone.
Gold surrenders gains and drops to weekly lows near $2,550
Gold prices reverses the initial uptick to record highs around the $$2,600 per ounce troy, coming under renewed downside pressure and revisiting the $2,550 zone amidst the late recovery in the US Dollar.
Federal Reserve set for first interest-rate reduction in four years amid growing bets of jumbo cut
The Federal Reserve is widely expected to lower the policy rate after the September meeting. The revised Summary of Economic Projections and Fed Chairman Powell’s remarks could provide important clues about the rate outlook.
UK CPI set to grow at stable 2.2% in August ahead of BoE meeting
The United Kingdom Office for National Statistics will release August Consumer Price Index figures on Wednesday. Inflation, as measured by the CPI, is one of the main factors on which the Bank of England bases its monetary policy decision, meaning the data is considered a major mover of the Pound Sterling.
Moneta Markets review 2024: All you need to know
VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.