Biden likely to win. Fed on hold. Fiscal stimulus desperately needed.

Friday 6th November 2020Depending on which news source you choose, Biden has either 253 or 264 electoral college votes. We’re likely to find out today, but Donald Trump’s legal challenges could delay the confirmation of the result. Markets have adopted a risk-on stance, with the hope that there will be fiscal stimulus to counter the impacts of COVID, but other progressive policies, including tax rises, would be challenged in the Senate. Elsewhere, the Bank of England coordinated the injection of extra funds into the UK economy, with extra bond buying coinciding with the extension of the furloughed workers’ scheme. In Europe there’s hope that the EU can progress with the implementation of the Recovery Fund. NAB’s David de Garis says it highlights the need for the same fiscal and monetary coordination in the US, as COVID cases rise and the jobs recovery stalls. Today though, the Fed, offered nothing new.

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