Falling share prices. Investors piling into the safe haven of bonds. Rising infection rates of the Delta variant of coronavirus. The events of the past week have demonstrated one thing clearly: this isn’t over yet.

A couple of months ago the way out of the crisis looked clear. Immunisation programmes were allowing developed countries to remove restrictions on activity. A pick-up in growth was expected to continue without interruption. Rising government bond yields were seen as a sign of life returning to normal.

That may well prove to be an accurate description of where the global economy is heading. It is too early to say whether the financial market wobble of past week was merely a bump in the road or something more serious. It is, though, easy to see how the situation could turn very nasty indeed.

As things stand, cases of the Delta variant are rising rapidly across western economies. The UK is several weeks ahead of the rest of…

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