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  • Bitcoin, the world’s most widely-traded cryptocurrency and beneficiary of the pandemic, has surged past $20,000

  • US retail sales fell more than expected in November

  • Wales and Scotland have strengthened guidance on socialising at Christmas

Vaccines may be on the horizon but virus continues to thrive

UK ministers are wobbling over the wisdom of relaxing lockdown restrictions during the festive period amid rising rates of coronavirus infections in many parts of the country.

Health experts have called on the government to “reverse its rash decision to allow household mixing”, characterising it as “another major error” that would “cost many lives” and could see hospitals being filled to the same levels as during the pandemic’s first peak in April.

The problem is a universal one as governments across the world weigh lives against livelihoods and the economic costs of shutdowns.

Germany today began a hard lockdown, with schools and many shops closed until January 10, a decision that economists say could bring a double-dip recession.

Pakistan reported its highest number of daily deaths from coronavirus since June as it tightened restrictions on large gatherings; Turkey, suffering its second-highest number of daily infections, announced a four-day lockdown from December 31; South Korea said a surge in cases meant hospital beds were becoming scarce. And the Brazilian city of Rio has cancelled its famous New Year’s Eve beach party.

Meanwhile, in the US, the number hospitalised with Covid-19 rose for the 10th consecutive day, with worrying death and infection figures across the country. 

There are no easy solutions for policymakers. Protecting the public against the virus has to be measured against the effect lockdowns are having on mental health and economic activity. 

After a traumatic year, many would dearly love to see out 2020 by relaxing and celebrating with their loved ones but, as the FT Editorial Board points out: “It is exactly this desire for human contact that viruses have evolved to take advantage of.” Sars-Cov-2 appeared just before the Chinese lunar new year, and swift action to restrict travel out of Hubei province probably helped reduce its transmission. In contrast, the relaxation of curbs around Thanksgiving celebrations in the US were followed a short time later by the country’s deadliest week of the pandemic. 

The launch of vaccination programmes does, however, mean we can at least use the new year to toast the beginning of the end.


Oilfield services group Petrofac said it expected customer demand to remain subdued by the effects of the pandemic as it announced further cost cuts. The International Energy Agency cut its forecast for 2021 oil consumption because of premature “euphoria” about how quickly vaccines could revive air travel.

Veteran adviser and FT regular Mohamed El-Erian outlines the risks awaiting investors in 2021. Will “the great disconnect” between Wall Street and Main Street come to an end? And how will the changing role of central banks and the prospect of corporate bankruptcies affect the investment landscape, he asks.

The rebound in UK equity capital markets over the past few months sets the scene for a bumper year for IPOs in 2021. Pent-up demand is likely to first benefit sectors such as tech that have remained resilient throughout the crisis.

Column chart of Total amount raised $bn showing London IPOs this year outstripped deals in 2019, despite the pandemic


US regulators have rated Moderna’s Covid-19 vaccine “highly effective”, paving the way for possible approval this week. BioNTech’s jab — set to receive European approval next Monday — is to become the first foreign coronavirus vaccine to enter China, in partnership with Fosun Pharma. Company founders Ozlem Tureci and Ugur Sahin, who FT editor Roula Khalaf says “epitomise scientific endeavour at its best” are our People of the Year.

BioNTech’s Ugur Sahin and Ozlem Tureci — the FT People of the Year © Felix Schmitt/Focus/eyevine

Inditex, the world’s biggest clothes seller and owner of the Zara chain, said revenues had almost reached pre-pandemic levels in the third quarter. UK retailers, however, are set for huge job losses, while a new study exposed the chasm between store bosses’ pay and that of their workers. Clothing discounts were a big factor in driving UK inflation lower last month.

Line chart of  showing Hiring data points to big falls to come in retail employment

European bank shares rose on news that the ECB would sanction the return of dividend payments, albeit with tough conditions attached. Banks that are profitable can pay their shareholders up to 15 per cent of their past two years’ profits, up to a maximum of 0.2 per cent of their common equity tier one capital ratio.

Global economy

Former UK prime minister Gordon Brown wrote for the FT on the need for a G20 global plan to revive growth that also helped lower-income countries. The challenge, he said, was “to create the global demand that will reactivate the investment and employment that are the key to growth and the eventual reduction of debt — to the benefit of all nations, rich and poor alike”.

Fresh survey data hinted at economic stabilisation in Europe as the contraction in services was partially offset by encouraging manufacturing activity. Madrid correspondent Daniel Dombey examines prospects for Spain, one of the biggest beneficiaries of the EU’s €750bn recovery fund. Big companies such as Telefónica, Iberdrola and Seat plan to use the aid to help finance projects in areas such as clean energy and digitalisation.

Investors are keenly awaiting the latest update on the US economy from the Federal Reserve and its outlook for next year. Here are four things to watch ahead of the statement later today. Political leaders, meanwhile, are edging towards agreeing a new stimulus deal.

The essentials

Have the pandemic and lockdown life made you consider a change of career? And how much will you need to support yourself while you pursue your dream? Listen to the new episode of our Money Clinic podcast with consumer editor Claer Barrett.

Have your say

Please share your views with us — email us at Thanks

Horsesatemymoney comments on Punitive sick leave rules make us all pay:

When I was younger I did way too much of the soldiering on and did myself some damage through repeated colds, which then spawned chest infections and bronchitis. So I learned the hard way this was stupid. Even so, being an office worker, being able to work from home when sick has meant I have taken few sick days. Until this year — I have had a minor and a major surgery — the latter meant I was off work for two months. I am hugely grateful that I didn’t have to worry about sick pay or rushing back to work before I was ready. I’m acutely aware a lot of people are much less fortunate and would have been caught between pressure to return, financial pressure and on the other hand pain and the doctor’s orders.

Final thought

Books about reading — and books about books — “offer not only delight but also the sense of possibility and potential”, says FT critic Erica Wagner, something sorely needed amid the despair of the pandemic. “A good guide to reading offers the presence of a fellow book-lover — something especially important in a time of isolation,” she writes.

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