The economy has been hit hard by the pandemic, unstable political situation, and the decline in oil prices and production. The devaluation combined with a modest recovery in oil prices could put the fiscal stance on a more sustainable footing. Improved governance is also needed to implement reforms. 

Global sustainable debt issuance hit an all-time record of over $655 billion in 2020, driven by rapid growth in ESG and sustainability-linked bonds. A more supportive global policy landscape could spur even more issuance in 2021

Last week we proposed using positive data surprises as a test of Fed forward guidance. Intuitively, Fed forward guidance is a promise to keep rates low even when data are strong. If markets believe this guidance, positive data surprises shouldn’t push up US interest rates. The importance...