US and China, 9 more months, stimulus, pandemic and pound

The world's two largest economies continue to balance on the brink of a new escalation: sanctions, closure of consulates, threats to ban Chinese social networks in the United States, etc. The most obvious problematic target in the nearest future is the phase 1 agreement between the United States and China.

China has not yet fulfilled its obligations on imports from the United States (the percentage of fulfillment is less than 25%). Given how tense relations between countries are, there is every chance of a return to the good old trade wars between countries.

In Germany, meanwhile, were wondered how long it would take for the economy to return to pre-pandemic levels. According to a survey of German companies conducted by the Munich-based Ifo, about 9 months. Beverage and pharmaceutical companies will be back on track within seven months, while the key auto sector is evaluating them in eight months. The sports and recreation industry, along with the arts and other entertainment-related businesses, will face the longest disruptions that will last until next summer.

Meanwhile, the US pandemic situation continues to improve, but is still extremely dire. In the world as a whole, everything is worse, but even at the global level there is a feeling of reaching a second pandemic plateau.

The US stimulus package is still underway. Republicans blame Democrats. Mnuchin, in particular, said that an agreement can be reached this week, if the democrats will be “reasonable”.

Today is interesting thanks to the data on the UK labor market. In this light, we recall that on Wednesday the figures on the UK GDP will be published. Given how weak the data is expected to be, current pound prices seem like a great selling opportunity.