Stresses starting to show: weekly roundup 21 August 2020

This was a week when it felt the economic stresses of lockdown really seemed to starting to show and were reported more widely.

All of this still seems to be building towards some sort of crunch point at the end of the summer, early autumn.

After the summer is after all when the UK furlough (which still covers 12% of the workforce) and payment deferral schemes are due to expire. Evictions are also due to restart in England too.

All of this piling more pressure on the consumer at the same time… potentially a building storm front.

It is not necessarily all bad news for everyone though, there were some brighter spots showing a bounce back somewhat quicker than expected.

  • The 2nd hand car market, prices see to have returned to more normal levels, as the economy gets moving and people turn to driving rather than public transport… good news for motor finance (and maybe even oil prices) longer term.
  • Retail sales seem to be returning, with what seems to be a sustained movement to online too. (Although CFO’s reportedly do not seem to be that prepared should sales do not return to previous levels).
  • Digital and touchless processing also continues as a running theme, with a move to cashless payments, in part due to fears regarding COVID, although this will also help the velocity of payments, hence the economy too.

So this is starting to maybe be a story of polarisation. Those that are impacted negatively could be impacted significantly, but many may not be impacted at all…. one to watch closely and see how it develops.

Lastly, on a more personal note, I was sorry to see the closure of STA travel. For many of us, this was the travel agency we booked and travelled much of the world when we were younger and could (actually) travel… good experiences and many memories, they will be missed.

Have a good weekend everyone…. @chris_w_tweet

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