The global economy is set to grow strongly in 2021 amid a rebound in developed markets (DMs) led by the US. This should provide a helpful boost to exports from emerging markets (EMs). The IMF forecasts real GDP growth of 6.7% for EMs in 2021 and 5% in 2022, after a contraction of -2.2% in 2020. There are, however, six major risks which could affect EMs to varying degrees over coming quarters. In this research note we will use our Fathom Financial Vulnerability Indicator (FVI), which gauges the likelihood of sovereign, banking or currency crises in 176 countries, to help

The number of global, new, confirmed cases of COVID-19 is on a downward course, with case numbers halving since the peak in January. This level still appears high relative to numbers seen before the second wave around October, but the difference in levels of testing makes direct comparisons difficult. The level of deaths appears to be a clearer measure as it does not depend in the same way on the level of testing and remains higher than the levels seen for most of the pandemic. It seems probable that a mixture of non-pharmaceutical interventions (NPIs), voluntary social distancing, existing immunity,

With the UK vaccination programme now having passed the government’s target of offering initial doses to the highest priority groups (over-seventies, clinically extremely vulnerable and frontline workers), focus is now turning towards the pace at which lockdowns are likely to be relaxed. As health officials are keen to stress, these decisions will be based on the spread of the disease as well as vaccine coverage. Reassuringly, both of these measures are currently moving in the right direction. Fathom’s central scenario remains optimistic, with a sharp recovery in output likely over the course of the year. A handful of countries have

The UK government has targeted 14 million vaccinations by mid-February, with the aim of providing initial doses to key workers, the clinically extremely vulnerable and the over-70s. To date, just over 2.8 million doses have been administered, approximately 20% of what would be required under a one-dose strategy (or 10% on the double-dose approach). If doses continue at the current rate of 1.4 million per week, that goal could be achieved by the middle of March, a month later than targeted. Of course, the rate ought to pick up as mass vaccination sites come on stream, and so mid-March may

Refresh this chart in your browser | Edit the chart in Datastream A lot has changed over the Christmas period, and the end of pandemic appears closer, but the road has got bumpier. In the three weeks since the previous article,[1] more countries have begun to administer multiple, highly effective COVID-19 vaccines. And the UK’s transitional arrangements that had been in place since it formally left the EU have come to an end with a trade deal agreed, meaning that tariff- and quota-free trade will continue, in goods at least. Both these developments have been as we expected. More worryingly, two new

Despite the upbeat sentiment around coronavirus vaccines, the hard truth remains that the COVID-19 emergency is not over yet. Large parts of Europe remain in lockdown to tame the number of new cases and control the number of deaths. While cases are now falling, governments have blemished their records by continuing to rely on blunt and expensive instruments to achieve this, such as widespread mobility restrictions. Many of the lessons from the first wave have been unheeded, and policies have largely remained reactive rather than proactive. This is all too clear when we look at the latest trends in deaths

This week has been more optimistic than the majority of 2020, lifted by positive news on the development of the long-awaited COVID-19 vaccines. Moderna, an American biotechnology company, reported an efficacy rate of nearly 95%, a week after similar results were announced by a rival candidate vaccine, BioNtech. These encouraging announcements boosted the likelihood that a vaccine will be distributed soon, buoying equity markets around the world.  Some of the best performing indices were those in Europe, which had previously suffered weeks of decline as growing numbers of COVID-19 cases prompted further economic restrictions. Refresh this chart in your browser | Edit

The world looks rather different than it did at the start of the week, after news emerged of a potentially game-changing coronavirus vaccine and a winner in the US presidential election. Pfizer and BioNTech told the world’s press on Monday that their coronavirus vaccine was 90% effective in initial results. That is nearly twice as effective as vaccines against influenza, which are estimated to work in 40% to 60% of cases. If the early findings hold good, this is excellent news, and it duly triggered bullishness in equity markets, with indices gaining around the world. Refresh this chart in your