OPEC + failure, OECD forecasts and ADP data ahead

So far, the main event of the week is the current failure of the OPEC + meeting. Instead of the expected decision to extend the current voluntary production cuts in the oil market for another 3-6 months, we have confusion. So far it has not been possible to agree on anything. The UAE insists on a fairly simple thought: what is the point of talking about some terms of the deal if the deal is still not respected. And it is clearly not easy to object to this reasonable question in the framework of OPEC +. But hope dies last and the solution to the problem has been postponed until Thursday.

Otherwise, the world continued to live on dreams of vaccines, imagining how soon everything will return to normal. We have already noted that reality will at best begin to match current expectations in the third quarter of 2021. Because here and now, over half a million people in the world are infected every day, and most of Europe is shrouded in a network of full or partial lockdowns. All this cannot but harm the economy.

As a result, yesterday the OECD updated its own forecasts for the pace of economic development in the world and noted that the resumption of the coronavirus pandemic has dramatically weakened the global economic recovery. Downgraded global growth forecast for 2021 to 4.2% from 5% in September.

And according to the S&P Global, the shock due to the coronavirus will more than double the default rate of companies in the US and Europe over the next 9 months (for example, in Europe, the default rate will rise from 3.8% to 8.5%).

But who is interested in the opinion of some OECD or S&P Global? It is much more interesting to show historical highs in the stock market or in cryptocurrencies.

Nevertheless, we continue to live in a paradigm where objective reality is no less important than subjective perception, and therefore today we will monitor US employment data from ADP. Recall that the main block of statistics on the US labor market will be published on Friday. It is unlikely, but still it can remind dreamers of what the economy is in fact here and now.