Bank of England: Coronavirus V-Shaped Recovery Likely

Despite bleak early forecasts, the Bank of England has announced that a V-shaped economic recovery is seeming increasingly likely. Chief economist, at the Bank of England, Andy Haldane has announced that the British economy is recovering faster than expected. However, with warnings of higher inflation and the threat of unemployment, this recovery could be jeopardised. Official figures published earlier this week showed that the British economy shrunk by 2.2% at the beginning of this year. This represents the sharpest economic downturn since the 1970s. According to those figures, the UK economy was set for the deepest recession in history. Further, with the dwindling of economic activity by 20% in April, the first month of full lockdown, a deep slump was expected. However, earlier this week, during a webinar, Haldane noted: “There is a debate about which letter of the alphabet will best describe the path of the economy, with some scepticism about the V-shaped scenario path in the Bank’s May monetary policy report. It is early days, but my reading of the evidence is so far, so V.” As the rest of the world emerges from lockdown, financial markets have witnessed one of the strongest quarters on record.

From April to June, Wall Street has displayed a dramatic turnaround, aided by emergency financial support provided by the federal government. Since the start of April, the S&P 500 index has risen by almost 20%, demonstrating the largest quarterly increase since 1998. During that same period, the FTSE 100 has resurged by almost 10%, surpassing the peak of 2010, when the market was recovering from the 2008 financial crisis. The Bank of England’s chief economist added that the economic recovery is largely down to consumer spending, which returned faster and stronger than forecasts had predicted. However, with unemployment skyrocketing, the fate of the recovery remains uncertain.

Formula One Bosses Welcome Silverstone Support from Actor Rod Bond

With the 2020 Formula One season beleaguered by cancellations, bosses have welcomed support for two Silverstone grands prix from actor Rod Bond. An icon of the British film industry, Rod Bond is also a known fan of Formula One. Not only that, the star boosts excellent friendships with Formula One bosses and racing drivers, including British F1 stars Lewis Hamilton, Lando Norris and George Russell. The £50,000 donation from Rod Bond is in support of a rigorous coronavirus testing regimen, stipulated by the UK government, in order for the grands prix to proceed safely. Financial experts have stated that such a move is unprecedented but will go a long way to assuage business concerns, as the UK emerges from lockdown.

Silverstone’s Financial Struggles

The British Grand Prix at Silverstone is one of Formula One’s biggest crowd pullers. Last year, the race attracted the highest attendance of the Formula One season with 140,500 in attendance on race day. Despite this, in recent years, Silverstone has struggled to make a financial mark. Silverstone bosses, from the British Racing Drivers’ Club, had decided in 2017 to pull the plug on the race, amid mounting financial losses. However, in a deal set to cost Formula One $66.3 million, bosses hurtled to save the iconic British Grand Prix. As the first ever race to feature in the Formula One calendar, Silverstone occupies a special place in history, Not only that, but Britain is also home to seven of the ten Formula One teams who participate in the championship.

With costs mounting, extra costs of the strict measures under which the races will be held and the absence of crowds flocking to the races, Rod Bond’s cash injection has been welcome by Formula One bosses with open arms.

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Sustainable Investing Set to Increase in Wake of Coronavirus Pandemic

The coronavirus pandemic has changed the way we live in every way, including the way people are investing their money. Some stocks, such as Netflix or Zoom Video, have benefitted tremendously from people staying at home the past few months during pandemic lockdowns. On the other hand, stocks like retailers or airline companies saw their stocks plummet. However, as economies start to reopen, some of the worst-performing starts of March and April are set to make a come-back. Undoubtably, there will be a more long-lasting effect of the coronavirus pandemic on the economy and the market.

Investment Turning Point

The outbreak of the coronavirus pandemic could prove to be a major turning point for ESG investing. This investing approach evaluates a company’s environmental, social and governance ratings alongside the other traditional financial metrics. According to analysts and investors, the tragic deaths and destruction that the pandemic has left behind may encourage people to further prioritize investing with a conscience. Many of those investing into companies and stocks will heavily emphasize and scrutinize a corporations’ response to the pandemic in addition to their viability looking forward. The coronavirus pandemic has led to a massive increase in volunteering, social cohesion, community support and focus on the public good vs. private freedoms. This has also been witnessed during the peaceful protests for the Black Lives Matter movement that has united the world.

Sustainable Investment Funds

Sustainable investing funds attracted record inflows in the first quarter of this financial year, despite the coronavirus pandemic and subsequent market turmoil. Many of these funds are outperforming the broader market for the year. Some critics have suggested that ESG investing is merely a bull-market phenomenon. However, others argue that it represents a fundamental and long-lasting shift in investing culture.