The re-acceleration of Covid infections has hit mobility hard over the past two weeks. Although there are clearly seasonal factors at work (which the Google data series do not account for), we’ve clearly seen a pronounced deterioration in both mobility and economic activity above and beyond what could have been normally expected. This has been concentrated in Europe, with a particularly severe drop in Germany where our economic activity measure suggests things are even worse than at the peak of the crisis last April. Italy and the UK have also registered steep falls, while Spain and France have seen more modest drops.
Globally, the Google mobility and economic activity indices haven’t budged much over the past week. That’s a good thing as they’ve sustained the pickup seen in late November, defying the rebound in Covid infection rates we’ve seen in several places. This also takes us through the noise of US Thanksgiving.
There has been a strong pick up in the DM mobility indices over the past week, the US rebounding over the Thanksgiving period while the easing of restrictions in Europe have boosted mobility and economic activity there – the most notable improvement being in France. Trends elsewhere remain similar, with the exception of Korea which has seen a continued deterioration amid a “third wave” there and tighter restrictions, which continue to be added to.
The Google mobility indicators show a further decline in both mobility and economic activity over the past week. The dip perhaps overstates the scale of the drop with US Thanksgiving holiday (which generated a bump in activity going into the holiday, and dip during and after) combining with tougher localised restrictions there. The story in Europe was better.
The latest google mobility statistics suggest things have stabilised a little. Although the devil is in the detail. On the DM side, Europe looks fairly static from last week but this masks a further sharp drop in Italy, which offset something of a bounce in France and the generally steadier picture we’ve seen in Germany and Spain.
We’ve seen a further downturn in the European mobility, as national lockdowns continue to bite, with the UK, France and Italy all falling significantly over the past seven days. Spain and Germany have been steadier, helped by the fact that they’ve been able to bend the Covid infection curve, with new cases rolling over and doing so from lower infection levels. Looking at things globally the picture looks more balanced, European weakness offset by ongoing improvements across Asia and in the larger emerging markets.
The latest Google mobility data is starting to show the impact of lockdown 2.0. What is interesting is how both Lockdown 2.0 is being implemented compared to the draconian measures enacted back in the spring, and how these restrictions are varying in their impact country to country. The regional divergences we identified last time persist. This is again a function of the resurgence of the virus in northern hemisphere developed markets, and the measures taken to combat this.
The tale of diverging fortunes between Asia and Europe (and to a lesser extent the US) persist in the latest Google mobility numbers, as rising Covid infections in certain countries drag on mobility. The second round of national lockdowns in Europe have started to drag on overall mobility.
The resurgence of Coronavirus in the developed economies, specifically Europe and to a lesser extent (so far) the US is leading to a clear divergence in economic activity According to the latest global mobility and economic activity data (running through to 16 October), DMs continue to show a deceleration in activity.
Global mobility and economic activity data, published by Google, is pointing to some loss in the momentum of recovery. Although the mobility indices continue to register small improvements (despite the resurgence of the virus in many places), economic activity is not following through from that.
To refresh, these indices measure the level of activity as measured against the pre-pandemic level using the Google Mobility Indexes, adjusted by Independent Strategy. Activity is a smoothed average of the economic and mobility measures, which provides a guide to the current recovery trend. The data runs through to the end of September.
These indices measure the level of activity as measured against the pre-pandemic level using the Google Mobility Indexes as adjusted by Independent Strategy. Activity is an average of the economic and mobility measures. The data are weighted and averaged over seven days to define the trend. The data runs through to 11 September. The current deviation from where things stood pre-crisis is shown in Figure 1.
We’ve been honing high-frequency indicators to follow the pace of recovery in major economies from the depths of the Covid pandemic lockdowns. Our indicators, entitled mobility and economic activity indexes, measure the level of activity against the pre-pandemic level using the Google Mobility Indices and the Dallas Fed’s Mobility Engagement measure. We adjust these to obtain a smoothed and comparable index of near-time activity.
The weekend election in Hamburg ran largely to script (see our report Thuringian tremors 7th February 2020). The SPD-Green coalition,…
Well, that didn’t take long. After last week’s debacle in Thuringia (see our report Thuringian tremors 7 February 2020) CDU leader Annegret Kramp-Karrenbauer (AKK) found her authority fatally undermined and announced that she would soon step down to allow a new leader to be elected in the summer. This leader, she said, should also become the party’s chancellor candidate for the next federal election, scheduled for autumn 2021.
The expected bounce in German factory orders remains elusive with a further sharp (-2.1% m/m) decline recorded in December. That leaves the y/y rate at a scary -8.6%, a new low and overall orders now 12.6% from their peak using the seasonally adjusted volume numbers.
Germany has just reported much-improved industrial production numbers for November. In volume terms they jumped 1.1% mom on a seasonally-adjusted basis, better than consensus expectations for a 0.8% rebound. So the downturn is over? Don’t bet on it.
A modest bounce in German factory orders in September (+1.3% m/m wda), which has pared the yoy decline a little. But at -4.6% yoy orders are still clearly a weak spot, having recorded 13 consecutive months of yoy declines. That leaves total orders around 10% below their late 2017 peak.
Another weak IFO survey. The manufacturing sector remains particularly soft, offsetting what was a modest bounce on the (resilient) services side of things. The IFO clock moved further towards recession territory. While it might not yet be formally in this quadrant, the scale of the decline over the past year suggests we’re closer to, if not already in, a technical slump.
Although there was a slight upward revision to the June numbers, there isn’t much to cheer in the German July factor orders report. Orders fell a further 2.7% m/m. That takes the current decline to -11.2% from its peak.