This is likely to mean that many companies will pay more tax, and that those using favourable tax regimes might decide to ‘onshore’ profits back to their countries of origin.
The COP26 meeting in Glasgow will dominate the news this week, and will offer a challenge to investors as governments attempt to find ways to slow global climate change without jeopardising the benefits, especially to developing nations, of future economic growth.
Bond investors, having had to grapple with a broad rise in yields in recent months, face another busy week, with the Federal Reserve’s decision on stimulus tapering, and the phasing out of bond purchases, due today, while the Bank of England announce their decision as to whether they will raise base rates tomorrow.
Rising inflation numbers are presently a growing concern for most central banks, and they are having to weigh up the impact of higher interest rates on borrowers, and possibly exacerbating escalating costs of living, against ensuring the economy does not see an inflationary spiral.
Sterling has weakened marginally over the past week, but is still trading within a tight range against US Dollars and Euros, both of whose central banks face an identical quandary to the Bank of England in terms of gradually removing future stimulus measures.
Most Western stock indices moved higher over the past seven days as US earnings continue to surprise on the upside, indicating the post Covid-19 recovery is still going strong and likely to continue as more economies open up further with the rollout of vaccine boosters.
Commodities (with the exception of agricultural prices) slipped back following a strong showing the previous week, whilst cryptocurrencies had a mixed week, with Ethereum leading the way higher once again.