COVID Recovery Monitor - Capital Economics
Global Economics

COVID Recovery Monitor

Global Economics Update
Written by Kieran Tompkins

While new COVID-19 infections have dropped, our Mobility Trackers have shown only a slight pick-up in activity as tight restrictions remain in place in many economies. Vaccine rollouts have been slow in the euro-zone and most EMs, but much faster in the US, UK, Israel, and UAE. Israel’s experience suggests that governments may lift restrictions quite quickly once a high level of vaccine coverage has been reached.

  • While new COVID-19 infections have dropped, our Mobility Trackers have shown only a slight pick-up in activity as tight restrictions remain in place in many economies. Vaccine rollouts have been slow in the euro-zone and most EMs, but much faster in the US, UK, Israel, and UAE. Israel’s experience suggests that governments may lift restrictions quite quickly once a high level of vaccine coverage has been reached.
  • Virus numbers. Global new COVID-19 infections have been falling sharply since mid-January, from a peak of around 740,000 per day to under 370,000 by 17th February. (See Chart 1.) The improvement has been common to all regions, but the sharpest falls have been seen in advanced economies. Most notably, daily case numbers have dropped from around 250,000 to roughly 80,000 in the US. (See Chart 2.)
  • There has also been a dramatic improvement in Europe, where the latest surge in case numbers was most pronounced. This appears to have reflected the tight restrictions imposed in many of those economies from late 2020. (See Chart 3.) These included national lockdowns in Germany and the UK, while most Italian regions moved up a band in its tiered system. Even in France, where restrictions were laxer in the form of an evening curfew, case numbers have drifted downwards.
  • High-frequency data. Our Mobility Trackers show that there has been a slight upturn in mobility from late-January in each region. (See Chart 4.) The largest improvements have been in emerging Asia and emerging Europe. The successful suppression of outbreaks in Taiwan, Thailand, and South Korea appeared to encourage more activity before a renewed decline over Chinese New Year. (See Chart 5.) Meanwhile, improvements in emerging Europe will probably continue as restrictions on hospitality and leisure have relaxed in Poland and the national state of emergency has ended in Czechia.
  • Increases in mobility have been more modest among the advanced economies and it is still well below December levels in Germany, Spain, and particularly the UK where tight restrictions remain in place. (See Chart 6.) However, there has been a marked improvement in Italy, where many regions have now moved down a tier, allowing restaurants and bars to open during the day and people to travel more freely. There has been a modest improvement in the US too, which should continue as restrictions are eased further: indoor dining is now allowed and stadiums are set to reopen in New York, for example.
  • Vaccine rollouts. Israel, the UAE, UK, and the US are in the lead. (See Chart 7.) And after a delayed start in Chile, the rollout has taken off, with over 10% of the population receiving a vaccine dose in the past two weeks. (See Chart 8.) The process has been slower or even failed to start outside of these countries. (See Map.) Supply complications have set the euro-zone behind. And while Japan and Australia both have large vaccine orders, a slow approvals process has meant that rollouts there have only just begun.
  • Other vaccine news. There has been more good news about vaccines, with Janssen and Novavax reporting efficacies of 66% and 89%, respectively, in phase 3 trials. Neither of these vaccines require the extreme cold storage which has complicated use of the Pfizer vaccine. Canada, the UK, and the US have pre-orders of both, while the EU, COVAX and the African Union have large pre-orders of the Janssen jab.
  • There are also early signs that vaccination is having positive health effects in Israel. New infections among those aged over 60 (one of the first groups to be vaccinated) have dropped by around 65% since the winter peak. This compares to a more modest decline of 35% in the rest of the population. The Israeli authorities have responded by easing restrictions on retail, hospitality, and leisure, which may bode well for other economies. But there are some concerns that Israel is moving too quickly and its strategy of opening certain activities only to those who have been vaccinated may be unacceptable in other countries.
  • Not all developments have been positive. South Africa has halted its vaccine rollout as preliminary evidence showed limited protection from the Oxford/AstraZeneca vaccine against mild and moderate forms of disease caused by the variant predominant in the country. And finally, we have seen even more vaccine nationalism as the EU placed manufacturers under reporting requirements if they intend to export vaccines. We will continue to monitor the latest health data, the progress of vaccine rollouts and the effects on mobility and activity on our coronavirus webpage and in our database CE Interactive.

Chart 1: Global New COVID-19 Infections (7d MA)

Chart 2: New COVID-19 Infections (7d MA)

Chart 3: Oxford University Government Response Stringency Indices

Chart 4: CE COVID Mobility Trackers*

Chart 5: CE COVID Mobility Trackers*

Chart 6: CE COVID Mobility Trackers*

Chart 7: Total Coronavirus Vaccine Doses Administered
As a % of Total Population (Latest)

Chart 8: Total Coronavirus Vaccine Doses Administered
Per Hundred People

*Trackers expressed as a % diff. from Jan.-6th Feb. mean level, 7d MA

Sources: Refinitiv, CEIC, Oxford University, Moovit, OWID, CE

Map: Total Coronavirus Vaccine Doses Administered Per Hundred People

Sources: OWID, Capital Economics


Table: Selected Recent Publications

Date

Publication

Title

Tue 16th Feb.

European Economics Update

Portugal’s recovery shifting into reverse

Fri 12th

Emerging Markets Economics Update

EMs: why this recovery will be different

Thu 11th

China Economics Weekly

Vaccine rollout will accelerate

Latin America Economics Update

A closer look at Latin America’s vaccine rollout

European Economics Focus

Pandemic has improved Italy’s debt dynamics

Wed 10th

Canada Economics Update

Easing of restrictions to gradually lift employment

European Economics Focus

Spain set for short-term gains, but long-term pain

India Economics Update

Taking stock of the vaccine rollout

Tue 9th

UK Economics Update

How to spot if the COVID-19 crisis has left a scar

Mon 8th

Africa Economics Update

Another blow to vaccine distribution in Africa

UK Economics Focus

COVID-19 legacy may be higher inflation and bigger public deficits

Fri 5th

Emerging Europe Economics Weekly

Sputnik V gets a thumbs up, Turkey’s constitutions plans

UK Economics Weekly

Two upsides to our upbeat forecasts

Thu 4th

Energy Watch

What if travel restrictions are not eased later this year?

Latin America Economics Update

Second waves take steam out of Latin America’s recovery

Wed 3rd

Global Economics Update

Resilience of business services to cap falls in output

Tue 2nd

Japan Economics Update

The risks to our upbeat vaccine assumptions

Fri 29th Jan.

Canada Economics Weekly

Reliance on the kindness of strangers raises problems

Emerging Europe Economics Weekly

EU vaccine row, MNB asset purchases, CBRT impresses

European Economics Weekly

Poor start to vaccine rollout poses risks to recovery

Emerging Asia Economics Weekly

Korea recovery, new virus threats

Japan Economics Weekly

Skies brightening, AstraZeneca-JCR deal boost

Thu 28th

Emerging Markets Activity Monitor

Reasons to expect the EM recovery to soldier on

Wed 27th

Emerging Markets Economics Outlook

Uneven vaccine roll-out to drive multi-speed recovery

China Economics Update

This lockdown could boost the economy

For copies of any of these reports, please e-mail sales@capitaleconomics.com


Kieran Tompkins, Assistant Economist, kieran.tompkins@capitaleconomics.com