Local update

Eligible vulnerable Islanders can now book their spring booster with appointments available from today, Friday 11 March.  Spring boosters are currently being offered to the following vulnerable groups as advised by the Joint Committee on Vaccination and Immunisation (JCVI):

• all Islanders aged 75 and over
• immunosuppressed Islanders aged 12 and over
• residents in care homes for older people

Vulnerable Islanders are being offered a spring booster now due to waning immunity since their last vaccination, and the associated increased risk of developing severe illness if they catch COVID-19. 

Islanders aged 75 and over who are not resident in a care home or considered immunosuppressed are being asked to book their spring booster on www.gov.je/vaccine or by calling the Coronavirus Helpline on 0800 735 5566 if they need assistance with booking an appointment.

Over the next couple of weeks, the vaccination team will be visiting residents in care homes to administer their spring boosters. Eligible immunosuppressed individuals are being sent letters and leaflets in the post from today and will be provided with an appointment date and time around 6 months (and not before 3 months) since their last dose of vaccine. 

Housebound Islanders who received a home visit for previous COVID-19 vaccinations do not need to book an appointment or call the Coronavirus Helpline. They will be contacted directly by the vaccination team over the coming weeks to arrange a home visit to get their vaccine. 

The Vaccination Centre is encouraging other Islanders to book appointments rather than walking in without an appointment, while they prioritise administering spring boosters to vulnerable Islanders. Spring boosters will be administered providing at least three months have passed since their last vaccination dose.

If the last booster was missed, eligible Islanders are urged to receive their spring booster as soon as possible. 

Deputy Medical Officer for Health, Dr Ivan Muscat, said: “The latest evidence shows that booster doses provide high levels of protection against severe disease from the Omicron variant”.

As the horrific events in Ukraine continue to evolve, we are writing to update you with our current views on the situation and our thoughts on the possible next course of action.

While we are very much aware of the humanitarian crisis that is developing in Ukraine, we are focused on the impact on investments of recent events. We are looking through the current and immediate news flow towards the longer-term impacts and outlook for investments. 

The current situation is evolving at a rapid pace and markets are reacting aggressively to changes in the news flow narrative as investors try to determine what each event means for the markets.

Recent examples are the strong rally in equity markets after the Fed announced that it still intends to raise rates in March, followed by a strong equity sell-off after a fire at the Zaporizhzhia nuclear power plant in Southern Ukraine. 

Market volatility, especially intra-day volatility, has increased and large market movements are typical of the state markets are currently in.

Ukraine update

Our current base case is that this increased market volatility is likely to continue until there is some progress towards a resolution, whatever that resolution may be and however long it takes to get there. Models are created with a longer-term investment horizon in mind and while we cannot predict unexpected black swan events, such as the invasion of Ukraine.

However, we are also preparing for how the investment world will look following a resolution to the situation, in whatever form that takes. We are looking through the short-term noise into the longer-term impacts on issues such as an increasingly inflationary environment, the impact of the sanctions on Russia, the longer-term issues surrounding defence and energy in Europe etc. 

This is an extremely fluid situation, and we are monitoring and evaluating developments intently to ensure that any appropriate measures are taken at the appropriate time.

The war in Ukraine has introduced new uncertainty to a stock market that’s already had a shaky start to the year. The S&P 500 saw its most drastic one-day drop since May 2020, amid a war with no end in sight and mounting sanctions on the part of the U.S. and its European allies. 

With hundreds of civilians dead, including children, and more than half a million refugees having fled Ukraine, the most important consequence is clearly the human cost, rather than anything having to do with people’s investments. As the war continues, so does the unpredictability of the consequences beyond the borders of Ukraine. 

After the invasion last month, the S&P 500 index logged its first correction in nearly two years, meaning it dropped more than 10% from its recent peak — and even though there was uncertainty about what was going to happen next, the U.S. stock market bounced back quickly. 

Several experts this week said that while the human costs of this war are capturing attention across the globe, the financial implications are a bit more complicated. For now, at least, the experts say the strength of the response by NATO and European nations has stalled concerns that Russia’s attack on Ukraine had the potential to send global markets into a free fall, experts say.

When the market starts to tank, investors might be tempted to overreact and sell their investments, but experts advise against that. “Don’t pull your money out. Don’t stop investing. Any reaction you have to the situation is more likely to hurt you than help you,” says Jeremy Schneider, personal finance expert at Personal Finance Club.

The rebound of the stock market shows that volatility in investing is par for the course, and investors should not panic.

If you have any queries or concerns regarding this, please do not hesitate to contact us.

Mixed markets

The FTSE 100 climbed 0.42% to 7,131,94 after opening this morning, while the European stock markets showed a downward turn: CAC fell 0.2%. The DAX was up 0.31%.

Yesterday the Dow Jones Industrial Average fell 112.18 points, or 0.34%, to 33,174.07, the S&P 500 lost 18.36 points, or 0.43%, to 4,259.52 and Nasdaq dropped 125.58 points, or 0.95%, to 13,129.96.

Asian markets finished mixed as of the most recent closing prices. The Shanghai Composite gained 0.41%, while the Nikkei 225 led the Hang Seng lower. They fell 2.05% and 1.47% respectively.

Ukraine brings a cause for concern

The invasion of Ukraine by Russia creates enormous uncertainty for the UK economy, according to the chancellor.

This is despite the fact that UK growth rebounded in January as the impacts of the Omicron Covid version began to fade.

According to the Office for National Statistics, the GDP increased by 0.8% in January, compared to a 0.2% decline in December.

However, economists have warned that the UK may face a recession as a result of a steep increase in living costs, which has been exacerbated by fuel price increases caused by the battle.

Prior to Russia’s invasion of Ukraine, UK consumers were already suffering rapidly rising expenditures, owing in part to skyrocketing energy bills.

Suren Thiru, the British Chambers of Commerce said: “Russia’s invasion of Ukraine has increased the risk of a recession in the UK by exacerbating the already acute inflationary squeeze on consumers and businesses and derailing the supply of critical commodities to many sectors of the economy” 

According to Kitty Ussher, chief economist of the Institute of Directors, the key question facing the UK economy is whether people with enough money to spend would be “more pleased about the retreat of the virus than they are concerned about the financial impact of the grim news from Ukraine”.

Cost of living crisis continues

According to government insiders, Rishi Sunak will take some limited action to address the cost of living crisis in this month’s spring statement but will resist calls to expand his much-criticised energy bill reduction scheme.

With rising pressure from inside his own and some City analysts projecting inflation of 10% within months, the chancellor has directed Treasury officials to devise strategies to cushion the shock for consumers.

However, Treasury sources emphasise that the government cannot protect the public from what is a global problem – and emphasise that the public finances are weaker than they were at the onset of the pandemic when Sunak adopted dramatic measures such as the furlough scheme.

“We have dealt with one crisis that was supposed to be once-in-a-generation, and we have just walked into another one,” they said. “There’s only so much that can be done, and we’ve never seen oil prices where they are now.”

One commonly discussed possibility would be to enhance state benefits by more than the 3.1% budgeted for last autumn, which appears destined to amount to a significant real-terms loss given the sharp rise in inflation subsequently.

UK consumers can help the war effort

The prime minister’s commitment to join the US in phasing out Russian oil – and to investigate methods to do the same with gas – is intended to damage the Kremlin’s coffers, but it also poses a challenge for the UK.

Russia supplies around 4% of gas and 8% of oil to the United Kingdom, significantly less than its European neighbours. However, the uncertainty in the energy markets has caused gas and fuel prices to skyrocket, worsening the cost of living crisis.

Weaning ourselves from Russian resources – whether by seeking supplies elsewhere or increasing our use of renewables and nuclear – will be costly and time-consuming.

One obvious option is to consume less gas and oil in the meanwhile through a nationwide effort that, while reminiscent of earlier global battles, does not have to be nearly as traumatic and may have long-term benefits.

Methods range from turning down the thermostat and driving slower on the highway to hastening the transition to technology such as heat pumps.