Measuring the UK Economy's Reopening...Why Global Insurers Are Adding Risk...Outlook for Sports Betting

[Goldman Sachs]( [BRIEFINGS] April 29, 2021 Measuring the UK's Reopening The reopening of the U.K. economy is off to a strong start, according to data from Goldman Sachs Research. The lifting of restrictions on outdoor dining and non-essential shops helped push GS Research’s broader tracker of European reopening up 5% for the week ending April 18 versus the prior week. Restaurant bookings surged, in-store retail sales climbed above pre-COVID levels and the labor market is benefiting from a recovery in the hospitality industry. GS Research’s U.K.-specific activity index jumped 19 points in the same week to hit -43% of pre-pandemic levels—with a large part of the remaining gap resulting from international restrictions. These trends bode well for the rest of Europe as the pace of vaccination in the region has quickened and is projected to cover 50% of the population in June. SHARE: [twitter]( [facebook]( [LinkedIn]( [email](mailto:?subject=Measuring%20Britain%E2%80%99s%20Reopening&body=) Why Global Insurers Are Leaning Into Risk Amid improving economic growth, global insurers are leaning into risk by adding more credit and private assets to their investment portfolios, according to Goldman Sachs Asset Management’s 10th annual insurance survey, which reflects the views of insurers representing about half of the industry's assets. “Overwhelmingly, what we saw out of the report was risk on—adding more risk. We saw that across the life [insurance] companies, the property casualty companies, the health care companies, the reinsurers. We saw it across regions...[and] risk types,” says Mike Siegel, global head of Insurance Asset Management, who discusses the results of this year’s survey on the Exchanges at Goldman Sachs podcast. The industry’s move into private assets, such as private equity and private credit, accelerated for two primary reasons, Siegel notes. “First, the returns in the private markets are better than the returns in the public markets. And secondly, the insurers are able to take advantage of illiquidity,” he says. “They have very stable balance sheets. They're not subject to a run. So they're better positioned than anybody else to put capital to work and earn that illiquidity premium you see in the private markets.” [Listen to podcast]( SHARE: [twitter]( [facebook]( [LinkedIn]( [email](mailto:?subject=Why%20Global%20Insurers%20Are%20Leaning%20Into%20Risk&body=https%3A%2F%2Fyoutu.be%2F3Z-St-sDQ_s) The Daily Check-In With Goldman Sachs Above (L to R): Stephen Grambling and Andrew Boak of Goldman Sachs The market for sports betting—especially online sports betting—represents one of the largest consumer growth opportunities over the next decade, according to [Stephen Grambling]( of Goldman Sachs Research. “We forecast a $39 billion online sports betting market by 2033 at maturity,” Grambling says on a recent episode of The Daily Check-In. The enthusiasm around sports betting accelerated after the Supreme Court overturned the Professional and Amateur Sports Protection Act—which had effectively banned commercial sports betting in most states—and “opened the door for legislation on a state-by-state basis,” he says. The ascendance of online sports betting will likely blur the lines between operators and media companies, Grambling notes. “The traditional sports betting customer is under 40 years old,” he says. “This is important because the leagues and media companies have both talked about cord cutting and are having a more difficult time both attracting younger consumers and keeping them engaged with sports going forward. So, as we think about the sports betting apps attracting this younger customer, they could, over time embed content directly into the app and circumvent any intermediary.” In another episode of The Daily Check-In, [Andrew Boak]( of Goldman Sachs Research discusses Australia’s macro backdrop and monetary policy, including how its central bank could set the first modern-day precedent for exiting yield curve control. “With the passage of time and the improvement in the economy, there's a growing tension between the Reserve Bank of Australia's commitment to keep the yield on the three-year bond at 0.1% while simultaneously guiding that interest rates could rise as soon as 2024,” Boak explains. “Resolving that tension, really, is the main reason for the RBA to start exiting the yield curve control policy. And in doing so, it will also provide them with greater flexibility to respond to potential upside surprises in the macro outlook over the medium term.” [Watch videos]( SHARE: [twitter]( [facebook]( [LinkedIn]( [email](mailto:?subject=The%20Daily%20Check-In%20With%20Goldman%20Sachs&body=https%3A%2F%2Fwww.youtube.com%2Fplaylist%3Flist%3DPLIyiGQywEp65ogt2Bi3vTK7ngXDTM6wT9) Goldman Sachs Media Highlights Bloomberg Opinion - April 27 [Mobilize the Market to Fight Global Warming, By Michael Bloomberg and David Solomon]( Bloomberg - April 22 [How Goldman's Kostin Is Investing as Higher Inflation Looms]( (6:23) [Subscribe]( [Unsubscribe]( The data provided in this newsletter is for information purposes only and should not be construed as investment or tax advice nor as a recommendation to buy, sell, or hold any particular security. 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