Welcome to the second edition of THE TREASURY HUB Banking and Treasury Markets Bulletin of 2021. It has been a very active start to 2021 on all fronts – currencies have made some material early moves, interest rates are moving up, stock markets are a little jittery while oil has raced ahead again.
In Ireland, the announcement was made by NatWest to wind down the operations of Ulster Bank although it is fair to say that it had been well flagged.
On the currency front, GBP has “exploded out of the traps” mainly due to a very strong vaccination process. Although Brexit is now a reality, the consequences of it are being felt by UK exporters, especially in the SME sector but this is not holding back the currency for now as the vaccination programme and speed of recovery of the economy is taking centre stage. By comparison USD is treading water. The impact of the Biden stimulus plan is currently being evaluated although moves in interest rates suggest the pace of recovery is also expected to be strong in the US.
From an investment perspective the NASDAQ continues where it left off last year although prices have been volatile (Tesla is 18% off its 2021 high in early January). The ISEQ and FTSE 100 are marginally ahead of year-end but markets appear a bit nervous about possible corrections. Oil has stormed into 2021 while Gold has eased back somewhat as economic prospects improve along with increased vaccination rollout.
Finally, section 5 in this month’s bulletin takes a look at various banking trends already emerging.
Please get in touch with our Corporate Finance team if we can be of any assistance.
The Treasury Hub - Banking and Treasury Report February 2021 can be downloaded here.
For any queries relating to this newsletter, please contact Chris Ball, Partner.