Quarantine will be a thing of the past in NSW from November. Premier Dominic Perrottet says domestic and international travellers will not have to isolate on arrival into the State. Travellers from around the world will need to be fully vaccinated and test negative for COVID-19 on departure and arrival.
NSW is the first State in the country, working with the Commonwealth, to announce it will open up to travellers from overseas and scrap quarantine rules.
The world is in better shape than we think
Despite an unprecedented shutdown to the global economy and then a sharp recession in Australia, consumers both here and in the U.S. are in the best shape they have been in for years.
Labor markets have snapped back with incredible rapidity. Currently, there are 70% more job vacancies in the U.S. than pre-pandemic and 10% fewer people looking for work. This is the largest gap in history.
Household balance sheets are also stronger. As a result of the government stimulus, consumers have accumulated trillions of dollars in savings ready to fire up the economy before Christmas holidays.
Debt is the lowest it has been in a generation and the cost of servicing that debt is the lowest on record.
So what do we have to look out for?
The three things we have to manage over the next two years are:
- The Vaccine roll out; avoid another lockdown
- Interest rate increases
- Price and wages inflation spike
1. The U.K.’s approval of Merck & Co.’s Covid-19 antiviral pill has added to the management of Covid, going forward. British regulators described the treatment as safe and effective.
Moderna CEO came out during the week saying that people over the age of 55 will probably need a booster shot every year to manage both Covid and the common flu. If you are under 55 you can get by with a booster every two years.
2. Interest rates during the week remained unchanged by the Australian Reserve Bank. The world’s central banks are pushing back in unison on the idea that higher interest rates will be needed to fight a run of high inflation and have now bound their monetary policies tight in the hope that the world’s tangled supply chains are on the verge of repair.
3. Inflation is expected to dissipate over time, as supply disruption eases, global demand rebalances, and energy prices stop rising, with a peak likely in April next year, according to Reuters.
It’s a recommitment, in a sense, to one of the core aims of monetary policy since the onset of the pandemic: to keep borrowing costs low for long enough to see households and national economies through to the end of the health crisis, a goal still not met given ongoing infections, missing jobs, and uncertainty about when workers might more fully return.
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