The Day at a Glance | March 12 2021

The Top

· Biden announces return to normalcy in the summer (July 4th) because of how quickly vaccination programs are being carried out.

· US stock markets were on their way to reaching historically high levels yesterday; Nasdaq and technology stocks have recovered the most.

· Checks for 1,400 dollars will start to be distributed this weekend.

· Bonds are once again close to reaching 1.6% (1.54%) amidst the fiscal package`s approval.

Economic environment

January`s industrial production report was made public in the Eurozone and showed an 0.8% increase during the month. The figure set slightly higher than expectations and improved with respect to the previous month`s figure (0.1% contraction). Despite the fact that the economic recovery in the Eurozone has lagged behind that of the US, it`s expected to recover as time moves forward, led by manufacturing. However, public data has shown that there has been modest progress given the pandemic`s considerable impact; furthermore, some partial shutdowns are still in place in the region.

Volatile markets in the following weeks. As Biden approves the new fiscal package worth 1.9 trillion dollars and checks begin to be distributed as soon as this weekend, markets will remain cautious of inflationary pressures due to an increase in demand, which will force the Federal Reserve to re-calibrate its monetary policy. The 10-year bond once again reaches 1.6%. However, Powell and Yellen have stated that they`d rather extend stimuli than have it fall short. It seems that policy makers will not change their highly accommodative stances, even though markets seem doubtful of stimuli continuing for a long period of time.