Global News
Wuhan Virus update – Following growing concerns over the severity of the virus originating from Wuhan, China, Chinese officials have halted travel, placing the city in a state of lockdown in an attempt to contain the outbreak. The respiratory based virus has already claimed 26 lives with a further 881 confirmed to have the disease. The World Health Organisation is yet to confirm whether the virus is an international health emergency. The travel ban comes ahead of the Lunar New Year break, where hundreds of millions of people are set to travel in the biggest annual migration of humans on the planet. Asian stock prices have fallen throughout the week, with markets including travel, retail and luxury sectors being hit hardest. This decline in stocks prices and market activity has come at a poor time for an already stagnant Chinese economy, as they are trying to encourage consumer spending.
Central Bank Updates – While the European Central Bank (ECB) have kept their loose policy rates unchanged, on Thursday, it was announced that there will be a review regarding how they measure inflation. The plans mark the first strategic review in 16 years and comes at a time when central banks are grappling with doubts about whether their main tools have lost their effectiveness, given that inflation remains below their targets, despite years of accommodative policy measures. The ECB have also examined whether it should alter its €200 billion corporate bond holdings to tackle the effects of climate change.
The Bank of England (BoE) are set to make their first decision of the decade next week regarding UK interest rates. While markets have been gearing up for an interest rate cut, news this week highlighted easing concerns over the state of the economy and interest rate cuts suggesting policy makers are more likely to ‘wait and see’ how the recent uptick in employment translates into activity before deciding on action.
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