Economic news

Markets Are Disappointed By the Cure

The world markets turned to decline at the end of the week, although US lawmakers approved a new $500 billion package, $300 billion of which intended for loans to small businesses. On the other hand, we heard the explanation of the details of the previous packages, and it slightly cooled down the optimism.

Markets Are Disappointed By the Cure

The US Treasury Department specified that loans for salaries wouldn’t be available for large public companies with access to debt markets. This happened after the fund of $350 billion was squandered in a month, and many family shops and cafes could not get this aid. Public companies that are critical to the state will receive assistance in exchange for a share in the business. Such clarifications and explanations have dissolved the hopes that the government will bear all the costs by giving money to companies.

At the same time, the European Union has so far failed to agree on a comprehensive long-term package of assistance to the economy. The agreed economic support package worth 540 billion euros will be launched on June 1, which may be too late. Time and again, the bureaucratic machine of the European Union makes the same mistakes: long term agreements in the end significantly increase the final price of aid. Soros’ proposal to produce eternal “coronabonds” of 1 trillion, following the example of what Britain did in the XIX – early XX centuries to finance wars, looks like a good idea. States will have to pay only coupons, and they will also be able to increase the amount of this loan and not increase the number of tranches.

Markets Are Disappointed By the Cure

Financial markets are equally concerned with health news, where news remains disappointing. The first clinical trials have shown that Remdesivir can’t show effectiveness in the treatment of seriously ill people.

One by one, hopes for improved financial performance, a cure for coronavirus and the ability of politicians to overcome internal divisions are disappearing. Against this background, we have a chance to end the week with a decline for the first time in five weeks. At the same time, EURUSD – a barometer of European investors’ sentiment – has been declining all week, slowly but steadily losing buyers.

Source: FxPro


To leave a comment you must or Join us


More news


Back to economic news list

By visiting our website and services, you agree to the conditions of use of cookies. Learn more
I agree