In the past six months, the economy has almost fully reopened, US initial jobless claims have dropped nearly to pre-COVID-19 crisis levels, the S&P 500 is up 15% (as of 6/30/21), consumer confidence is improving, and US financial conditions are strong. The extreme fiscal and monetary response provided by governments and central banks globally not only has supported the economy but also provided a kick-start to economic activity that has not been seen during previous recoveries. The fiscal response in the US alone has been greater in absolute terms and relative to the size of the economy than evidenced in the last fifty years, boosting US household income by 8%. In addition, the Fed’s major change in its monetary policy strategy from inflation targeting to average inflation targeting is keeping interest rates lower than anticipated even as inflation rises. 

Read or download our full 2021 Mid-Year Capital Markets Update [PDF]