Even though vaccination is being distributed at an encouraging pace, the UK continues to experience high daily new COVID-19 cases, showing that the Delta variant is much more dangerous as compared to the prior strains.
The summer came with a reduction in infections in most European countries, yet the UK represents one of the exceptions and now the country is reopening, despite signs of persistent virus spread.
Restrictions removed but caution remains
The reopening seems to be on a preset path, especially as the country kept restrictions in place for an extended period.
Economic consequences in the long-term weigh in on the governments’ decision-making process and the only thing left is to keep everything orderly, preventing the spread of the virus while also conducting the normal day-to-day tasks.
Boris Johnson, the UK’s Prime Minister, is currently in isolation after Health Secretary Sajid Javid confirmed a few days ago he had tested positive for COVID-19.
The same goes with Rishi Sunak, the acting finance minister, and that should be an additional warning sign for people who are treating the pandemic with complacency.
In fact, the PM urged the public to be cautious as the economy reopens. The daily count is still above 40k and despite slight retracement lower, it is located near the peak established in January.
Financial markets worried about growth prospects
Worrying signs related to the pandemic have recently generated some short-term uncertainty in the financial markets. Major stock indices retraced from all-time high as growth prospects were put into question.
If the Western World needs to face a new large wave of infections as the weather gets colder, that could dampen economic activity again, given governments might be forced to impose restrictions.
As stocks and commodities wobble, the question is where the capital is going to flow next and one of the markets that have been beaten down for months is crypto.
Can cryptocurrencies be favored again?
Bitcoin retraced more than 50% from the all-time highs and it is now hovering near the $30,000 area, struggling to form a bottom. The same goes with Ether, Litecoin, Neo, and Tron, altcoins covered by Coinlife and other cryptocurrency trading platforms.
A poor performance creates an environment where valuations are now more attractive and could incentivize capital to rotate back, especially as interest rates remain low and liquidity abundant.
Coinlife is one of the cryptocurrency trading platforms covering a broad range of instruments, providing professional support for customers and personalized trading software.
At the same time, Coinlife is updated on the market, offering a customized offer, ensuring customers can get involved in different tokens.
Prospects for a strong economic reopening might be postponed, keeping interest rates around the world at low levels. During the past year, cryptocurrencies have been favored by such conditions and it is yet to be seen if that is the case once again.
These assets have shown great upside potential, as digitalization seems to be a trend catching investors’ attention.