Although the coronavirus pandemic has been raging for more than two years, and there is a vaccine to fight it, it still manages to damage the country’s economy. What are the latest data and expert assessments of current events? What else can we expect from the Covid 19 pandemic, and when will the situation stabilize? Let’s dive in.
Stock futures fell sharply on Thursday, citing a move by the Federal Reserve to remove the stimulus. The created processes will hinder the development of the economy. It should be noted that the Covid pandemic proved to be detrimental to the economies of almost all countries.
The Dow Jones Industrial Average futures fell 0.7%. The Dow fell 380 points on Wednesday due to a reduction in bond purchases by the central bank in July.
Nasdaq 100 futures fell 0.5% and S&P 500 futures fell 0.6%.
According to Sean Bandazian, an investment analyst at Cornerstone Wealth, we should expect instability throughout the market shortly.
WTI crude oil fell 2.6% to $ 65. Copper lost 3.5% without support for buying Fed bonds.
Goldman Sachs cut its quarterly economic growth forecast from 9% to 5.5% overnight. The firm sees higher inflation as expected for the rest of the year.
The Solution to Save the Economy
According to Ian Hatzius, chief economist at Goldman Sachs, the impact of the coronavirus delta variant on inflation and growth is more significant than expected. He said that the cost of travel and other services would be reduced in August. However, this reduction will be short-lived and not so noticeable. Manufacturing supply chain disruptions are particularly acute in the auto industry, which means that inventories will be less renewed in the fourth quarter.
Nucor, a steelmaker, lost 4%. Oil companies Occidental Petroleum and Devon Energy lost more than 3%. General Motors fell 2%.
At a July meeting, the Fed’s central bankers planned to reduce their monthly bond-buying rates by the end of 2021.
The protocol states that it is advisable to start reducing the rate of asset purchases this year.
The Dow fell more than 1% on Wednesday.
Shares of Robinhood fell more than 11%. The Premarket Revenue report says the industry will see a decline in trading activity, which will lead to lower revenues and fewer newly funded accounts.
It is difficult for experts to say when it will be possible to achieve economic stabilization and a favorable rate; however, it is hoped that the Delta variant of the coronavirus will gradually reduce its scale and allow countries to take care of economic recovery.
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