Market Update - March 2021
Over the last month, the vaccine rollout in the US and the UK has forged ahead with full force. Initial analysis suggests that the vaccination programs have significantly reduced deaths, transmissions, and hospitalisations, which has brought about a rising sense of confidence.
In the UK, parents breathed a sigh of relief as children returned to school for the first time this year. At the same time, there were huge concerns that teachers returning to work unvaccinated would lead to a vicious surge in cases. That fear resulted in the government slowing down the relaxation of social distancing restrictions across the country.
Italy announced that they will delay exports of the AstraZeneca vaccine to Australia. The knock-on effect of this delay means that many Australians may not have the opportunity to get vaccinated until 2022. And fears emerged that AstraZeneca may cause blood clots after an incident in Norway.
In response to this, Ireland and the Netherlands paused their vaccination programs, despite AstraZeneca advising that there’s no medical evidence to suggest that the vaccine is to blame. The World Health Organisation has supported AstraZeneca’s statement, advising that out of the 335 million doses administered so far, no deaths have been found to be caused by any of the vaccines.
Researchers reported that the South African variant may spread more readily, and vaccines may not work as well against it. This information renewed fears that new mutations may become increasingly infectious. However, scientists have voiced their belief that there is no need to be worrying about mutations for now.
Despite so much going on at the moment, there are reasons for optimism despite the recent cases in Brisbane and Sydney. In Australia, quarantine hotel workers, medical staff and the most vulnerable members of our communities are receiving the vaccine. While medical treatments for those infected with coronavirus are improving all the time.
Financial markets took a hit as fears of high inflation and a rise in interest rates rippled through the markets. Although central banks don't intend to increase official interest rates until 2024, the expectation of better economic news means wages could increase sooner than expected. And if banks did an about-face, even a slight rise in interest rates could have a devastating effect on the economy.
With so much happening right now, we're keeping a close eye on how the volatility in the markets may impact your investment. Consequently, we've arranged to meet all our managers this month so we can take their expert advice and ensure your investment is best placed.