Transactions. Restructuring. Transformation. Financial Engineering.

Daily COVID19 Global Economy Newsletter May 26 , 2020

GLOBAL INSIGHT

One of the European Central Bank’s key policy makers signaled that the institution is very likely to boost its emergency bond-buying program to fight the coronavirus pandemic. With inflation low, there is room to innovate and act “rapidly and powerfully,” Bank of France Governor Francois Villeroy de Galhau told a conference in Paris on Monday. He also signaled that he’d like to see even looser limits on the 750 billion-euro ($817 billion) plan, which he described in a CNBC interview on Tuesday as a “masterpiece.”/ Bloomberg

The European Commission will unveil the details of a likely multi-trillion euro plan to fuel the green transformation recovery. A draft of that document suggests that low-carbon sectors of the economy will benefit, with hundreds of billions ploughed into promoting electric vehicle sales, renewable energy projects and into making new, green technologies economically viable./ Bloomberg

European Central Bank is likely to boost its emergency bond-buying program

EC to unveil itsgreen super plan

In both the US and the UK we have passed the crossover point at which people are now more likely to disapprove than approve of the government’s handling of the crisis. This is a more significant development in the UK, where previously the government had had very high levels of approval (as much as 72% in late March). Even in our previous survey the government held a ten-point lead, with 53% saying they had been doing well. Now, however, just 47% of Britons say they believe the government has been doing a good job, compared to 49% who do not. In the US 52% of people now say they disapprove of the government’s handling of the crisis,compared to 43% who do. Government approval had beenteetering for some time, however – the prior two surveys showed a one-point lead and an even tie./ YouGov

World shares forged ahead on Tuesday and commodity markets drove higher as well, as investors disregarded Sino-U.S. tensions to focus on more stimulus in China and a re-opening world economyBritain's FTSE and Japan's Nikkei led their regions with 2.2% gains, while U.S. S&P 500 futures cleared the 3,000 level for the first time since early March, when the economic impact of the coronavirus was just becoming clear. Europe’s early spurt saw the STOXX 600 score a near 11-week high. Travel and leisure stocks jumped almost 6% after Spain had said quarantine-free tourism would resume next month and Germany edged towards a 9 billion-euro bailout of airline Lufthansa./ Reuters

How people aroundthe world assessgovernments’ response the pandemic

Investors are trying to be optimistic

FRANCE

UK

GERMANY

French President Emmanuel Macron is set to announce measures to support the country's auto industry, highlighting the crucial role the industry plays in the economy and how hard it has been hit by the coronavirus pandemic. Macron said that support for the French car sector will be "massively amplified.„/ Automotive News Europe

The French finance minister had tried economic, financial and even moral arguments to convince his reluctant counterparts that they must pool their debts to save the European Union, officials said. As dawn broke, he let rip, telling the group that with thousands dying from the coronavirus they should be ashamed of haggling over numbers: ashamed for themselves, and ashamed for Europe./ Bloomberg

England’s outdoor markets and car showrooms will be able to reopen from June 1, as soon as they are able to meet the coronavirus guidelines to protect shoppers and workers. All other non-essential retail outlets will be expected to be able to reopen from June 15 if the government can control the spread of the virus./ Bloomberg

The British government has awarded more than 32 billion pounds ($39 billion) in loans and guarantees to businesses to see them through the coronavirus pandemic, finance minister Rishi Sunak said today./ Reuters

Two months after Germany’s economy minister vowed to do everything so “no job” would be lost to the pandemic, unemployment has already risen more than during the entire 2008/2009 financial crisis./ Bloomberg

INDIA

Confidence among German exporters improved in May after officials within the country and around the world eased lockdown measures. An Ifo gauge measuring trade expectations among manufacturers jumped by a record but remained below zero, indicating that pessimism receded even though it was still the prevailing sentiment. Companies in nearly all sectors continue to see declining exports, according to a survey of some 2,300 firms./ Bloomberg

The German government’s 9 billion-euro ($9.8 billion) bailout of Deutsche Lufthansa AG may cost the stricken carrier some valuable assets: Key flight slots at airports in Frankfurt and Munich.The European Commission wants Lufthansa to surrender the slots out of concern the aid will give the carrier unfair advantage over competitors, people familiar with the matter said./ Bloomberg

Foreign funds have slashed their holdings of India’s government bonds to the lowest in three years amid dwindling returns, just as the nation embarks on a mammoth borrowing plan./ Bloomberg

SECTOR NEWS

Automotive

Oil & gas

Leisure & Travel

Global market data (as of May 26, 2020)./ Reuters

The coronavirus pandemic buffeting the auto industry may prove to be a watershed moment for the alliance between Renault SA and Japanese partners Nissan Motor Co. and Mitsubishi Motors Corp. as they prepare deep cost cuts to survive. The car-making trio is set to unveil on May 27 a series of measures aimed at closer operational integration. These were promised at the start of the year and have been made more urgent by the steep drop in sales and unprecedented production halts rocking the sector./ Bloomberg

Oil prices rose today, supported by growing confidence that producers are following through on commitments to cut crude supplies while fuel demand picks up with more cars back on the road as coronavirus lockdowns ease./ Reuters

A top golf venue on the Spanish Mediterranean coast is about to discover how much aficionados will dish out to get there safely. The Sotogrande community that’s home to Ryder Cup-level courses, yacht slips and polo fields is offering a private jet service with more protections from Covid-19 than airlines offer. That means virus tests before boarding, fewer passengers and private terminals for clients en route to their seaside villa or hotel room. The bill: “about 5,000 euros” ($5,460) a person for three days on the Valderrama, Real Club de Golf Sotogrande and La Reserva courses./ Bloomberg

TMT

The COVID-19 outbreak has proven itself something of a poison chalice for global media outlets with some enjoying booming audience numbers while others are struggling to stay in business due to a collapse in advertising revenue. Most notably perhaps, the situation has created even greater challenges for journalists as they attempt to distinguish fact from fiction in a 21st century digital media ecosystem plagued by disinformation. Given the importance of accurate reporting about COVID-19, YouGov conducted a poll to see where trust in coronavirus coverage is highest and lowest. ./ Visual Capitalist

AFTER HOURS

Do you speak corona? Don’t be a “covidiot” – make sure your pandemic parlance is up to scratch./ The Economist 1843 Magazine

UNITED KINGDOM | FRANCE | GERMANY | BELGIUM | NETHERLANDS | iTALY | SPAIN | POLAND | RUSSIA | INDIAFRANCE | UK | GERMANY | BELGIUM | NETHERLANDS | iTALY | SPAIN | POLAND | RUSSIA | INDIA

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Eight International is a global advisory organization founded in 2016 by six consultancies sharing the same values. A globally integrated teamof over 70 leaders and over 600 professionals seamlessly advises corporate clients, businesses, private equity funds and leading investmentbanks to help navigate challenges across transactions, restructuring and operational transformation. Eight International brings innovativesolutions in a broad array of industries through its three key pillars: Reactivity via its nimble business model, Quality of its experiencedpractitioners and Independence, given no conflicts of interest.

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Marta MarczakCommunications Director at JP WeberInternational Communications Coordinator at Eight International

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