Cambridge Weekly – 21st December 2020

Goodbye to all that

December usually has a ring of ‘Silent Night’ in the investment world and, in a year where practically all else has changed, at least this has stayed the same. In the UK, news that millions more would be placed under tougher restrictions over the Christmas period may have felt deflating, but it was hardly unexpected and failed to get a peep out of capital markets.

The same goes for the other big headlines of the past week. Brexit negotiations were yet again kicked down the road, now with the European Parliament declaring that a deal must be agreed by Sunday to have any hope of being ratified in time (with a fiery look in their eyes saying this time we really mean it). The US election officially ended, with the Electoral College confirming President-elect Joe Biden’s victory and Republicans finally offering their congratulations (Donald Trump and his ‘MAGA’ supporters notwithstanding). Further progress came on the European Union’s €1.8 trillion recovery fund, after Hungary and Poland dropped their ‘Rule of Law mechanism’ complaints. And the US Federal Reserve (Fed) extended its debt purchase programme, but stopped short of calls to lengthen the average maturity of its bond purchases. All big stories, very little news.

Read the full commentary here