optimism increased during the month of February regarding the prospects for the growth of the global economy, especially in the United States, in light of the hopes of a gradual easing of precautionary measures to contain the Corona pandemic and the adoption of accommodative monetary and financial policies And the consequent strong economic recovery in the second half of 2021.
In addition, according to the National Bank of Kuwait report issued today, Monday, the financial markets, especially the bond markets, witnessed sharp fluctuations after they started pricing the possibility of raising interest rates and increasing rates. Inflation.
Central banks are aware of the dangers of high bond yields and the consequent impediment to the pace of economic growth before the high unemployment rates can be reduced, and they may seek to address these moves in meetings The upcoming monetary policy (the European Central Bank has already started taking some measures during the month of March).
On the other hand, oil prices continued to rise for four consecutive months, and the price of Brent crude touched the $ 70 a barrel barrier in early March, supported not only by increased hopes Economic growth, but also thanks to efforts to extend supply cuts led by Saudi Arabia.
US fiscal stimulus package approval
In a major boost to economic growth prospects, the US Congress approved President Biden's massive fiscal stimulus package worth $ 1.9 trillion (8-9% of GDP) . Note that the full amount will not be pumped out this year, but rather more than half will be used - including issuing incentive checks worth $ 1,400 for individuals and extending unemployment benefits of $ 300 per week until September - which will rapidly affect the economy, boosting consumer spending on In particular.
and confidence rates towards the economic recovery began to gain more momentum in light of the decline in daily new infections with the virus to their lowest levels in five months since the beginning of this month, and vaccination Most of the elderly are easing some restrictions at the level of different US states.
This is in addition to the beginning of the labor market recovery in light of the rise in non-farm payrolls and surpassed analysts' expectations of 379,000 jobs last February after the decline in December, with a record The sectors most affected by the repercussions of the pandemic, such as the hospitality sector, are strong gains. However, there are still about 10 million of the 22 million jobs lost due to the pandemic and have not yet been compensated.
