Geo-political news
COVID-19 – With confirmed cases and death tolls continuing to rise worldwide, countries begin intensifying their lockdown measures and have implemented more significant control policies. On Thursday, US President Donald Trump imposed a 30-day ban on arrivals from European countries, not including the UK, in an attempt to reduce the pace at which the coronavirus is spreading. European governments continue to implement tighter lockdown measures. Italy have closed all non – essential commerce including hair salons, bars and restaurants. Their government now projects a budget deficit of 2.7% of GDP this year, which is a breach of EU fiscal rules, posing the question of how this breach will be dealt with given the circumstances. Elsewhere in Europe, schools have been closed and sporting events have been played behind closed doors or even postponed. Many economies have introduced stimulus measures to combat the growing fears and panic buying experienced this week, sending major global markets into a free fall this over the week. The Bank of England announced a 0.5% rate cut this Wednesday; however, this stimulus measure had a somewhat underwhelming effect as continued announcements of tightening lockdown measures fuelled panic within markets. Many economists are pricing in a further 50bsp cut on March 17-18th, followed by the same again in May if markets continue to decline.
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