By Powerscourt on 22/08/2020
As a number of countries saw new cases surge, the head of the WHO offered cold comfort. Tedros Adhanom said on Friday that he hopes the pandemic will be over in under two years, noting that the Spanish flu of 1918 took two years to overcome but advances in technology could enable the world to halt this virus in a shorter time.
The euro fell as the eurozone’s economic recovery appeared to be losing momentum after several months of improvement. The recent resurgence of coronavirus infections in many European countries to levels not seen since May has brought fresh quarantine restrictions and localised lockdowns. However European leaders are determined to avoid renewed national lockdowns and many of the new infections have been among young people with no big surge in hospitalisations or deaths so far.
Coronavirus is spreading far faster in Spain than in the rest of Europe, with Spain reporting around 139 new cases per 100,000 population in the last 14 days.
Britain’s economy recovered strongly in August. The flash composite PMI rose from 57 in July to 60.3 in August, helped by the reopening of the UK economy in July and August and government initiatives such as temporarily lower VAT on the hospitality sector and discounted restaurant meals.
The growth hasn’t been free of charge – UK government debt exceeded £2tn for the first time, with borrowing at its highest ever peacetime level. Chancellor Rishi Sunak warned that extraordinary government support for the economy has to be time limited.
While US equity markets are reaching record highs, large US corporate bankruptcies are now running at a record pace and are set to surpass the financial crisis in 2009. A record 45 companies with assets of more than $1bn have filed for Chapter 11 bankruptcy, compared with 38 for the same period of 2009 during the depths of the financial crisis and more than double last year’s figure of 18 over the comparable period.
WHAT ARE COMPANIES SAYING?
Retail & Consumer
The causal eating chain is the latest to launch a consumer voluntary arrangement. Media reports claim a handful of sites will close but that job losses will be minimised. The company is using the CVA to seek “better alignment of the rents of certain sites in proportion with footfall and trading”. CEO Henry Birts said: “The extraordinary impact of Covid-19 on trading has meant that we now need to take additional steps to address our fixed-cost base if we are to secure the long-term future of our business.”
The youth and student travel agency has been widely reported as having ceased trading on Friday. The company faced criticism at the beginning of the pandemic for its handling of flight cancellations and travel restrictions, with many customers left to their own devices. Following yesterday’s development the company’s website holds a statement apologising for the ‘inconvenience and the limited information available’ at this time.
IN THE NEWS
Pandemic triggers wave of billion-dollar US bankruptcies – Financial Times
Fraud fears lead to block on bids for furlough cash – The Times
UK COVID-19 R rate rises to 0.9-1.1, epidemic could be growing – Reuters