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Luc De la Durantaye, chief investment officer, CIBC Asset Management.

That remains one of the key uncertainties and one of the key elements in our scenario, where we’ve assumed that the vaccine would help lower the number of cases, would help reopen the economies quite quickly and experience that strong growth and build that somewhat inflationary pressure.

Recently what we’ve seen is the emergence of a third wave. What we’re seeing though is, particularly in the U.S., vaccination has accelerated in the U.S. It’s far ahead of Europe and Asia in that regard, so there’s less concern from a U.S. perspective because vaccination is ramping up quite rapidly, and inoculation has increased.

The area of disappointment was in Europe, but what we’re starting to see, we’re starting to see the cases rolling over in Europe following the introduction of lockdowns, and so we’re seeing a peaking in this third wave already and reversing at a moderate level.

The other factors that keep us optimistic is that vaccination is finally speeding up in Europe, and we’re seeing that in the rate of vaccination, and vaccine supply in Europe is speeding up. It’s actually going to quadruple from the end of March to the end of June, so therefore a number of specialists are predicting that Europe will be able to have vaccinated 50% of its population by early July. This is despite the recent challenges of the AstraZeneca vaccine, because Europe is going to receive more than just AstraZeneca. They’re receiving also Moderna and Pfizer vaccines, and the shipping of these vaccines are accelerating during this second quarter.

We’re monitoring the situation, but we’re thinking that we’re still within the realm of our scenario that sees stronger growth and inflationary pressure in the second half of this year.

So, this is where we’re continuing to do some work in terms of the inoculation outside the developed world. One of the elements was the AstraZeneca vaccine, which was one of the key elements. It is still a vaccine that is effective, but there has been some slowing in terms of its distribution, so from that perspective we’re going to be monitoring that to see whether the rest of the world will continue to vaccinate as fast as the developed world or not.

That’s certainly one element that needs to be monitored over the next one quarter or two quarters to make sure that the total vaccination efforts continue to ramp up from here, so that’s something that continues to be on the radar.

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