The latest round of lockdowns will hit the economy again – but, perhaps, not as hard as previous ones did in 2020. That is thanks to three main factors: less public fear; better calibrated government policy; and adaptation by businesses. Greater optimism has already had an effect on the oil price, which has recovered from its lows of last year. The debate now is how high the prices of other commodities may soar. The dollar also looks strong, as measured by our Big Mac index. Remarkably, emerging-market share prices have hit a record high, and small, first-time investors are piling in, notably in Brazil. In Britain, although the end of its transition out of the European Union at the end of 2020 did not entail the disruption some feared, the immediate economic prospects look grim. And the long-term effects of Brexit will take years to make themselves felt.
The Economist: Lockdowns and the global economy
A pedestrian wearing a facemask walks past a stand with the Evening Standard newspapers in central London on Jan. 8, 2021, as England entered a third lockdown due to the novel coronavirus Covid-19.
