By Karen
Brettell , Kate Duguid
NEW YORK (Reuters) - The Federal
Reserve may have avoided inflaming the bond market with its latest policy
decision and outlook, but as economic growth rebounds and inflation rises, at
least temporarily, there are questions of how long yields will remain
contained.
That’s a key issue for both
investors and Fed officials who would rather not have to ride out another bout
of bond market volatility as a growing body of indicators suggests U.S. growth
is poised to take off this year.
The yield curve steepened to its
highest since September 2015 on Wednesday - with shorter-dated rates falling
faster than the long end - indicating investors took the Fed at its word that
interest rates would remain anchored even as the COVID-19 crisis winds down.
Recent evidence that an economic recovery has been taking hold had investors concerned
the Fed would withdraw its accommodative policy sooner than expected.
But while the Fed’s actions may be
keeping the yield increases relatively orderly, for now, a surge higher remains
a risk. That would raise borrowing costs for companies and consumers, and could
ripple across other assets such as equities.
“To me it feels like it is a coiled
spring,” said Mark Cabana, head of U.S. rates strategy at Bank of America. The
Fed’s current stance, he said, “does raise some risks that whenever we do begin
to hear a shift in tone from the Fed that there may be a bit more of a rapid
adjustment in the market.”
The Fed “is signaling that it wants
to see an overshoot, it wants to see inflation and employment run quite hot,”
Cabana said.
Fears of sooner-than-expected rate
hikes, or tapering of the Fed’s asset purchases, in recent weeks have helped to
send yields on longer-dated Treasury yields to the highest in a year.
The benchmark 10-year Treasury yield
rose to a high of 1.689% prior to the Fed’s statement following the close of
its policy meeting on Wednesday, its highest since January 2020. It later fell
to around 1.646%, though it remained higher on the day.
Two-year note yields, which are the
most sensitive to interest-rate policy, dropped as low as 0.125% after the Fed
meeting before bouncing back to 0.137%.
That meant the spread between the
two- and 10-year rates - the most common measure of the yield curve - widened
to 153.2 basis points.
---- The Fed’s message on Wednesday
was that rates are not rising in a hurry even though it sees the U.S. economy
rising 6.5% this year, unemployment falling to 4.5% by year-end and the pace of
price increases exceeding the Fed’s 2% target, at least temporarily. Powell
noted the “strong bulk” of the policy-setting committee anticipates no interest
rate increase until at least 2024.
More
https://www.reuters.com/article/us-usa-bonds-fed-analysis/analysis-fed-patience-calms-yields-for-now-but-market-feels-like-coiled-spring-idUSKBN2BA0D2?il=0
In rump-EUSSR
news, the paymaster is slowing down and going green and socialist, according to
the recent local election results.
German economy to shrink by 2% in
first quarter: government advisers March
17, 2021 10:25 AM By Reuters Staff
BERLIN (Reuters) - The German
government’s council of economic advisers said on Wednesday it expected
Europe’s largest economy to shrink by roughly 2% in the first quarter of this
year due to lockdown measures to contain the COVID-19 pandemic.
The council cut its full-year 2021
gross domestic product growth forecast to 3.1% from 3.7% previously. It expects
the economy to reach its pre-crisis level at the turn of the year 2021/22 and
to grow by 4% next year.
“The biggest downside risk remains
the development of the coronavirus pandemic. The question how quickly the
economy can get to normal mainly hinges on the vaccination progress,” the
council said in a statement, giving the first official forecast for the impact
in the first three months of the year.
Economists have warned that a
decision by Germany and several other European countries to suspend
AstraZeneca’s COVID-19 vaccine could delay progress in reaching herd immunity
and postpone a much hoped for easing of lockdown measures needed for a robust
recovery in the second quarter.
---- Council member Veronika Grimm said the
AstraZeneca shot was needed to speed up Germany’s already slow vaccination
campaign.
In order for Germany to achieve the
EU target of vaccinating 70% of the adult population by the end of September
2021, authorities must increase the number of daily shots given at vaccination
centres by 50%, Grimm said.
To achieve this, the AstraZeneca
vaccine is needed because it is easier to transport and store compared to shots
which need unusually low temperatures along the delivery chain, she added.
“In addition, family doctors and
specialists should be included in the vaccination process,” Grimm said.
In a worst case scenario in which
the AstraZeneca shot was banned permanently, it could be replaced in the
government’s vaccination plan only partially in the course of the year when
other vaccines such as Johnson & Johnson’s vaccine should become available,
Grimm said.
https://www.reuters.com/article/us-germany-economy/german-economy-to-shrink-by-2-in-first-quarter-government-advisers-idUSKBN2B91BB?il=0
Next, a guess at
future global oil demand. Well, their guess is likely as good as anyone else’s.
Oil demand to reach record by
2026: IEA Issued on: 17/03/2021 -
10:14
Global oil demand will return to
pre-pandemic levels in two years and reach record heights by 2026 unless
governments take swift action to meet climate goals, the International Energy
Agency said Wednesday.
Oil markets and the world economy
are recovering from the massive collapse in demand caused by the coronavirus
pandemic, the IEA said in an annual report.
"The Covid-19 crisis caused a
historic decline in global oil demand -– but not necessarily a lasting
one," IEA executive director Fatih Birol said in a statement.
ADVERTISING
As people get vaccinated and
restrictions are lifted, demand will return to its 2019 level by 2023,
according to the report.
The IEA's five-year projections
estimates global demand will rise each year to reach 104 million barrels a day
(mb/d) by 2026, a gain of four percent from the level in 2019.
The outlook for demand, however, has
shifted lower as the pandemic has forced changes in behaviour, with people
working from home and travelling less, the report said.
More governments are also focusing
on a potential "sustainable recovery" to move quickly towards a
low-carbon future.
This raises the prospect of reaching
a peak in oil demand sooner than expected "if governments follow through
with strong policies to hasten the shift to clean energy," according to
the report.
"Achieving an orderly
transition away from oil is essential to meet climate goals, but it will
require major policy changes from governments as well as accelerated
behavioural changes," Birol said.
"Without that, global oil
demand is set to increase every year between now and 2026," he said.
"For the world's oil demand to
peak anytime soon, significant action is needed immediately to improve fuel
efficiency standards, boost electric vehicle sales and curb oil use in the
power sector."
Asia is expected to lead renewed
growth in global demand and account for 90 percent of the increase from 2019 to
2026, according to the agency's base scenario.
"By contrast, demand in many
advanced economies, where vehicle ownership and oil use per capita are much
higher, is not expected to return to pre-crisis levels," the IEA said.
More
https://www.france24.com/en/live-news/20210317-oil-demand-to-reach-record-by-2026-iea
Finally,
why big pharma is pushing vaccines and not repurposing existing drugs like
ivermectin to treat or prevent Covid-19. Profits.
Get
ready to get “pharma hosed” later in the year and each year thereafter. It’s
probably why the big attack on the cheap Oxford AstraZeneca vaccine.
Pfizer exec
sees 'significant opportunity' to increase COVID vaccine price for annual
booster shot The exec. has previously noted current
vaccine cost is unrepresentative of the company's pricing model Mar 16, 2021
A top Pfizer executive told shareholders the company is
looking at a “significant opportunity” to raise the price of its
Pfizer-BioNTech COVID-19 vaccine.
While addressing investors at the virtual Barclays Global
Healthcare Conference last week, Pfizer CFO Frank D’Amelio noted they could
raise prices when the virus becomes endemic, meaning it’s regularly found in
clusters around the globe, according to a transcript
Current vaccine pricing models are pandemic-related,
D’Amelio explained. After the pandemic is defeated and “normal market
conditions” arrive, he noted the window would open for a “significant
opportunity…from a pricing perspective.”
The possibility of additional applications for the COVID
vaccine may also present itself. A third dose could be needed for variants and
regular booster shots, D’Amelio said.
“We believe it’s becoming increasingly likely that an
annual revaccination is going to take place,” he said. “Factors like efficacy,
booster ability, clinical utility will basically become very important.”
D’Amelio also noted in the address
that Pfizer’s COVID vaccine production is exceeding forecasts.
“For the full year, we had
originally said we thought we could do 1.3 billion doses. We’re now at 2
billion doses. And obviously, we’re working to improve upon that number as
well.”
In a February earnings call,
D’Amelio said the current vaccine cost is unrepresentative of the company’s
pricing model.
“So the one price that we published
is the price with the U.S. of $19.50 per dose. Obviously, that’s not a normal
price like we typically get for a vaccine, $150, $175 per dose,” he said, “So
pandemic pricing.”
https://nationalpost.com/news/world/pfizer-exec-sees-significant-opportunity-to-increase-covid-vaccine-price-for-annual-booster-shot
For
every complex problem there is an answer that is clear, simple, and wrong.
H. L. Mencken
Covid-19 Corner This
section will continue until it becomes unneeded.
The Latest: Hungary reports
record number of COVID-19 deaths By The
Associated Press March 17, 201
BUDAPEST — Hungary announced a record number of
COVID-19 deaths on Wednesday as a powerful surge of the pandemic put an
unprecedented strain on the country’s health care.
Health officials announced 195 deaths in the
last 24 hours, breaking the previous peak of 193 in early December. The number
of patients being treated for the disease rose to nearly 10,300, also a record,
and nearly three times the number of those hospitalized in early February when
the latest surge began.
Hungary has the seventh highest COVID-19 deaths
per 1 million inhabitants in the world, according to Johns Hopkins University.
Officials have sought to mitigate the surge
with new restrictions and a vaccination program that has made Hungary one of
the most-vaccinated countries in Europe.
A new shipment of 100,000 doses of the
Chinese-made Sinopharm vaccine, which among European Union countries is only
being used in Hungary, is expected to arrive on Wednesday, Foreign Minister
Peter Szijjarto wrote on his Facebook page.
With more than 50,000 jabs on Tuesday, nearly
1.4 million people have received at least one shot, the second-highest rate in
the EU.
— EU regulator ‘convinced’ AstraZeneca
benefit outweighs risk
https://apnews.com/article/seoul-discrimination-coronavirus-pandemic-coronavirus-vaccine-south-korea-b3fafd5403d760c81d31ebab852daa74
Covid-19 situation 'worsening' in
greater Paris region, hospital chief warns Issued on: 17/03/2021 -
09:45
The coronavirus situation is worsening in the greater
Paris region where hospitals are under immense strain, the director general of
the AP-HP Paris hospitals organisation, Martin Hirsch, said on Wednesday.
Hirsch told RTL radio there were two options to contain the
disease - a local weekend lockdown, already in place in other parts of the
country, or a broader lockdown in the region.
"The virus is not under control. There are as many
patients in intensive care units today as there were at the peak of the second
wave," he said.
Prime Minister Jean Castex said on Tuesday the time had come
for more coronavirus restrictions in the greater Paris region.
Hirsch said almost 1,100 people were in intensive care with
COVID-19
in the region, and that number could reach 1,700 by the end of the month if the
current trend continues.
In normal times, the greater Paris region
has an intensive care bed capacity of around 1,000, Hirsch said.
In France as a whole, there were 4,239 patients in
intensive care with COVID-19 as of Tuesday, close to a four-month high.
https://www.france24.com/en/france/20210317-covid-19-situation-worsening-in-greater-paris-region-hospital-chief-warns
India's coronavirus infections
rise by highest in three months March 17, 2021 4:34 AM
BENGALURU (Reuters) - India’s daily
coronavirus infections jumped by 28,903 on Wednesday, data from the health
ministry showed, for the highest increase since Dec. 13 and taking the
nationwide tally to 11.44 million.
Deaths swelled by 188, the highest
figure in two months, to stand at 159,044.
India has the world’s highest tally
of infections after the United States and Brazil.
Nearly 62% of infections in the past
24 hours and 46% of the deaths were reported by the western state of
Maharashtra, the country’s worst affected.
The federal government has blamed
crowding and a general reluctance to wear masks for the spike, ruling out the
virus mutations that have been a factor in Western countries.
Maharashtra, home to India’s
commercial capital of Mumbai, is among the states that have already tightened
rules to curb the spread of the virus.
https://www.reuters.com/article/us-health-coronavirus-india-cases/indias-coronavirus-infections-rise-by-highest-in-three-months-idUSKBN2B90GS?il=0
India says it has no concern
about AstraZeneca vaccine side effects March 17, 2021 11:46 AM
NEW DELHI (Reuters) - India has no concern about possible
side effects of the AstraZeneca COVID-19 vaccine being used in its immunisation
campaign, government health official Vinod Kumar Paul told a news conference on
Wednesday.
https://www.reuters.com/article/us-health-coronavirus-india-astrazeneca/india-says-it-has-no-concern-about-astrazeneca-vaccine-side-effects-idUSKBN2B91K3?il=0
Thai sniffer dogs can detect
COVID-19 in sweat, project shows March 17, 2021 11:14 AM
By Juarawee Kittisilpa
BANGKOK (Reuters) - Thai sniffer dogs trained to detect
COVID-19 in human sweat proved nearly 95% accurate during training and could be
used to identify coronavirus infections at busy transport hubs within seconds,
the head of a pilot project said.
Six Labrador Retrievers participated
in a six-month project that included unleashing them to test an infected
patient’s sweat on a spinning wheel of six canned vessels.
“The dogs take only one to two
seconds to detect the virus,” Professor Kaywalee Chatdarong, the leader of the
project at the veterinary faculty of Thailand’s Chulalongkorn University, told
Reuters.
“Within a minute, they will manage
to go through 60 samples.”
The dogs can detect a volatile
organic compound secreted in the sweat of COVID-19 sufferers, even in the
absence of disease symptoms, the Thai researcher said.
The dogs would not need to directly
sniff people, but could screen samples of sweat, a task that should not be
difficult in a tropical country such as Thailand, she added.
Chile, Finland and India are other
countries that have also launched efforts to get sniffer dogs to detect the
virus, with a German veterinary clinic saying last month its sniffer dogs had
achieved 94% detection accuracy in human saliva.
More
https://www.reuters.com/article/us-health-coronavirus-thailand-sniffer-d/thai-sniffer-dogs-can-detect-covid-19-in-sweat-project-shows-idUSKBN2B91GX
Next, some vaccine links
kindly sent along from a LIR reader in Canada. The links come from a most
informative update from Stanford Hospital in California.
World
Health Organization - Landscape of COVID-19 candidate vaccines . https://www.who.int/publications/m/item/draft-landscape-of-covid-19-candidate-vaccines
NY
Times Coronavirus Vaccine Tracker . https://www.nytimes.com/interactive/2020/science/coronavirus-vaccine-tracker.html
Stanford
Website . https://racetoacure.stanford.edu/clinical-trials/132
Regulatory
Focus COVID-19 vaccine tracker . https://www.raps.org/news-and-articles/news-articles/2020/3/covid-19-vaccine-tracker
Some other useful Covid links.
Johns Hopkins Coronavirus
resource centre
https://coronavirus.jhu.edu/map.html
Rt Covid-19
https://rt.live/
Centers for Disease Control
Coronavirus
https://www.cdc.gov/coronavirus/2019-ncov/index.html
The Spectator
https://data.spectator.co.uk/city/national
Technology Update.
With events happening
fast in the development of solar power and graphene, I’ve added this section.
Updates as they get reported.
Solar Cells: The mystery of the
missing energy - solved Competition
between triplet pair formation and excimer-like recombination controls singlet
fission yield Date: March 10, 2021
Source: Linköping University
Summary: The efficiency of solar cells can be
increased by exploiting a phenomenon known as singlet fission. However,
unexplained energy losses during the reaction have until now been a major
problem. Scientists have now discovered what happens during singlet fission and
where the 'lost' energy goes.
The efficiency of solar cells can be
increased by exploiting a phenomenon known as singlet fission. However,
unexplained energy losses during the reaction have until now been a major
problem. A research group led by scientists at Linköping University, Sweden,
has discovered what happens during singlet fission and where the lost energy
goes. The results have been published in the journal Cell Reports Physical
Science .
Solar energy is one of the most
important fossil-free and eco-friendly sustainable sources of electricity. The
silicon-based solar cells currently in use can at most use approximately 33% of
the energy in sunlight and convert it to electricity. This is because the
packets of light, or photons, in the sun's beams have an energy that is either
too low to be absorbed by the solar cell, or too high, so that part of the
energy is dissipated to waste heat. This maximum theoretical efficiency is
known as the Shockley-Queisser limit. In practice, the efficiency of modern
solar cells is 20-25%.
However, a phenomenon in molecular
photophysics known as singlet fission can allow photons with higher energy to
be used and converted to electricity without heat loss. In recent years,
singlet fission has attracted increasing attention from scientists, and intense
activity is under way to develop the optimal material. However, unexplained
energy losses during singlet fission have until now made it difficult to design
such a material. Researchers have not been able to agree on the origin of these
energy losses.
Now, researchers at Linköping
University, together with colleagues in Cambridge, Oxford, Donostia and
Barcelona, have discovered where the energy goes during singlet fission.
"Singlet fission takes place in
less than a nanosecond, and this makes it extremely difficult to measure. Our
discovery allows us to open the black box and see where the energy goes during
the reaction. In this way we will eventually be able to optimise the material
to increase the efficiency of solar cells," says Yuttapoom Puttisong,
senior lecturer in the Department of Physics, Chemistry and Biology at
Linköping University.
Part of the energy disappears in the
form of an intermediate bright state, and this is a problem that must be solved
to achieve efficient singlet fission. The discovery of where the energy goes is
a major step on the way to significantly higher solar cell efficiency -- from
the current 33% to over 40%.
More
https://www.sciencedaily.com/releases/2021/03/210310084702.htm
Nothing is so admirable
in politics as a short memory.
John Kenneth Galbraith.
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