Lockdown risks rise, low inflation here to stay

The escalation of virus cases in parts of France and Spain, with officials worrying about the strain on hospitals, means that we would not be surprised to see strict regional lockdowns imposed in the coming weeks that have the potential to weigh on economic growth. But a repeat of nationwide lockdowns that would cause the recovery to go into reverse still seems unlikely. Next week, September’s business and consumer surveys are likely to provide further evidence that the pace of the rebound has slowed substantially from the initial breakneck pace.