A fast start to the Biden era

The spotlight shone brightly on the US this week. President Biden’s new administration began with a flurry of activity: within hours of his inauguration, the President signed a host of executive orders to reverse his predecessor Trump’s decisions, including ending the travel ban on Muslim-majority countries, mandating the wearing of masks on federal property, and re-joining the Paris climate agreement.

The decision to re-enter the Paris agreement has given the already-buoyant sustainable investing scene some extra sparkle. Managers at Federated Hermes, Insight Investment, and Nordea say the move could be a prelude to introducing carbon pricing and border taxes in the US.

According to a memo seen by Reuters, an “omnibus” climate change executive order will land next Wednesday, that will include regulatory actions to combat climate change domestically and making climate change a national security priority.

Biden’s pick for Treasury Secretary, former Fed chair Janet Yellen, also plans to “act big” to tackle the coronavirus. Plans for a USD1.9 trillion coronavirus relief package could come before the House of Representatives within the next fortnight.

Investors are forecasting a pick-up in inflation as government pandemic relief increases under the new administration. This has prompted a sell-off in US 10-year Treasuries, rapidly rising yields on government debt, which asset manager Neuberger Berman believes will keep going up.

Meanwhile, in Europe, the focus has been on how much there is to learn in the year ahead. Read the latest guides on how financial institutions can best implement new EU sustainable finance rules and rooting out modern slavery and labour exploitation in investee companies.

Madeleine Taylor
Editor, Institutional Asset Manager
maddy.taylor@globalfundmedia.com

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