While this might defer tax rises into the New Year, the way in which the national debt is increasing will demand drastic action at some stage. Certainly, the past two weeks have been tougher going for markets as Covid-19 cases start to rise and the number of deaths globally pass the 1 million mark. And we are entering the most difficult period for the NHS, with winter flu on the horizon and a huge backlog of routine procedures still to be dealt with.
Little wonder that investors are fighting shy of committing themselves until at least some of the many uncertainties have been consigned to history. The third quarter of 2020 has just come to an end, which means that some indications as to how the global economy is faring will be arriving soon. As coronavirus continues to disrupt our lives, we must expect a mixed bag, though data from China has been remarkably good. To be fair, they were first into the pandemic, so presumably are the first to emerge. With industrial production there up by not far short of 20%, year on year, it certainly looks as though the worst is behind them
However, the upcoming elections in America and our Brexit negotiations are playing an increasingly important role in determining investor sentiment. The first of the televised debates between the Presidential candidates has taken place, though whether it will make any difference to the voting decisions is hard to assess. It came across as a bad tempered affair that probably did neither candidate any favours. However, it is not just the occupancy of the Oval Office that is up for grabs. Control of the Senate will also be determined by the American people. Whatever the outcomes of these elections, next year promises to be tough for those in command.
The news on the Brexit front has improved in recent days, with more encouraging noises emanating from Brussels. This gave some short-term respite for the embattled pound, but the Footsie has struggled of late. Buyers are holding back until the picture becomes clearer on all fronts. With the twin uncertainties of how we finally leave the European Union and what eventually transpires in Washington, suggests greater volatility in the weeks to come is inevitable.