US stocks fall for fourth day; dollar weakens

US stocks fell for a fourth day as investors assessed the prospects for a federal spending package and the likelihood for further virus-related economic restrictions. The S&P 500 fell by 0.44% to 3,647.49 while Dow Jones was down 184.82 points (0.62%) to 29,861.55.

Americans scale up spending plans for 2021, Fed survey shows

Americans are scaling up spending plans for the year ahead, according to a Federal Reserve Bank of New York survey. US households in November expected their spending to rise 3.7% over the next 12 months, results from the New York Fed’s monthly Survey of Consumers published showed. That compared to a 3% increase expected the prior month and marked the biggest expected increase in spending recorded in the survey since 2016.

Panetta says ECB is ready to expand pandemic buying if needed

The European Central Bank (ECB) is ready to boost its emergency bond-buying program if needed, Executive Board member Fabio Panetta said one day after Germany announced a hard lockdown in response to a surge in coronavirus cases. The 2021 will likely be a “pandemic year” with high uncertainty and widespread vulnerabilities among companies and households, Panetta told.

Conte says Italy will stick with its expansionary policy in 2021

Italian Prime Minister Giuseppe Conte pledged to stick to expansionary policies even after the pandemic is over, as he struggles to shield a fragile and debt-plagued economy from a resurgence of the coronavirus. The government’s policy is “based on confidence, reforms, investments,” Conte said. “We need to mitigate the effects of the uncertainty which will persist after the end of the pandemic emergency.”

Bundesbank urges EU debt transparency amid pandemic borrowing

European Union (EU) debt should start showing up in national accounts so that the unprecedented joint borrowing agreed during the coronavirus pandemic doesn’t obscure government finances, Germany’s Bundesbank said. The 27-nation bloc could end up with more than a trillion euros (US$1.22trn) in joint liabilities in the coming years, which doesn’t have to be added to national debt burdens even though much of the money is meant to be paid back through member states’ contributions to the EU budget, the Bundesbank said.

UK property boom will last another year, Rightmove says

The surge in UK property prices will persist into next year as housing needs outweigh economic uncertainty, according to Rightmove. It predicts asking prices will climb 4% in 2021 as this year’s unprecedented demand spills into the coming months. Currently there is a logjam of 650,000 properties in the market, with prices up 6.6% compared to this time last year, it said.

RBI’s Das sees wider India inflation target as meaningless

India’s central bank governor cautioned against a possible change to the country’s inflation target mechanism, saying that it would dilute its effectiveness toward setting monetary policy. “If you make the band too wide, then targeting loses its meaning,” Governor Shaktikanta Das said.

Oil edges higher despite OPEC’s lower demand view, lockdowns

Oil inched up as the market weighed the risks of toughening restrictions in New York and London ahead of a widely available vaccine. Brent crude for February settlement gained US$0.32 to US$50.29 per barrel.

Source: Affin Hwang Research - 15 Dec 2020