Joe Biden has signalled that he’s willing to remove intellectual property rights for covid vaccines,  which would enable many more factories across the world to start manufacturing and therefore significantly increase the pace of the global rollout.  This is a change of stance from the White House and has come about from pressure within the Democratic party,  as well as from 100 nations who all want to see production liberalised and get faster access to the product.  The pharma companies that hold the IP have complained and there will be lobbying efforts to make the lift in restrictions as narrow as possible,  with their main concerns being that this has knock on implications to other drugs that this would then be pushed for (Alexandra Ocasio Cortez has already spoken about wanting to ‘do insulin next’).  This isn’t a done deal however, the UK and EU would have to come onside among others, but with Joe Biden now adding his influence,  we’d imagine this is more likely than not.

Staying in the US,  Treasury Secretary,  Janet Yellen has begun a delicate manoeuvre, the U-turn.  On Tuesday night, Yellen pointed out that “it may be that interest rates will have to rise somewhat to make sure that our economy doesn’t overheat, even though the additional spending is relatively small relative to the size of the economy.” Needless to say,  this directly impacted the commodities market, with gold on the precipice of breaking through $1,800, and Brent crude knocking on the door of $69.  However,  later in the day,  Yellen took the opportunity to revise her remarks, intimating that she was neither predicting nor recommending a rate rise: “I don’t think there’s going to be an inflationary problem. But if there is the Fed will be counted on to address them,” she said as she passed the buck back to The Fed.  With gold prices strengthening, and other commodities knee-jerk reaction to the announcement, further comments from The Fed supported gold,  after they intimated that they would not be overly concerned by a brief rise to 3% inflation.

Voting is open across the UK in the biggest round of regional elections for nearly fifty years.  48 million people get the opportunity to vote in what is being seen as a broad test to the mood of the nation(s). Scotland is the one to watch,  with the SNP set to be the biggest party,  but may well fall short of an outright majority – though they won’t be short of coalition partners with views aligned on IndyRef 2.  Boris will be looking to see what other bricks he can paint blue in the red wall, with Hartlepool possibly set to fall despite having being sat in a Labour seat for the last 57 years – though “cash for curtains” might play into things and could give us a curve ball or two.

We also have an interest rate announcement from the Bank of England today, with the MPC expected to unanimously keep policy on hold.  The Monetary Policy Report is likely to intimate that the UK is on a path to recovery, with a revision upwards for GDP,  on the basis that the vaccine rollout has allowed the economy to be unlocked sooner,  there is little expectation in a change to forward guidance just yet.  It is likely that until the UK economy consistently achieves its 2% inflation target, the MPC will not tighten monetary policy.

There are two war ships on their way to Jersey,  to monitor the situation with French fishing boats.  Authorities in Jersey say that 100 French vessels were being lined up in France to blockade the main port in Jersey,  in a bid to cut off supplies to the island.  This is all a bit much to cover in a paragraph, but this Guardian article has a good run down of what’s going on and why – though it doesn’t offer any suggestion of what can be done to solve the issues and ideas for that do seem thin on the ground.

China has decided to suspend talks with Australia under the China-Australia Strategic Economic Dialogue.  The move is another downturn in the relations between both countries,  but is largely symbolic,  as they hadn’t discussed anything under this framework in the last four years anyway.  It was enough to move the Aussie Dollar sharply lower, but it seems like investors aren’t overly concerned and used it as a buying opportunity to get into Australian dollars as the losses have almost all been reversed. Bloomberg has the story.

Staying with geo-politics, there’s an interesting article in The Hill that talks about activity in and around the Middle East that could signal a breakthrough between US and Iran over the nuclear accord.  There are a lot of moving parts and a lot of stakeholders in the region, but it seems that there is willingness on most sides to come to an agreement,  albeit with conservatives in Tehran and Washington doing what they can to encourage a harder line to be taken.

Be well.

This Morning Report was brought to you by Alex Ayoub.


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