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.
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.
Total Covid-19 infections may just have broken the two million barrier globally. But there are encouraging signs that, at least in some places, active cases have already peaked. Scientists’ understanding of the disease is still in its infancy and there are many questions we don’t yet have clear answers to. In particular, if we’re all exposed to the same disease, why is there such a wide variation in apparent infection, fatality and recovery rates from country to country?
Bleak payrolls report. While the median survey was always going to be a short in the dark, the -701k decline in jobs was significantly more troubling than the mkts -100k guess. That’s the worst number since March 2009, a period of losses that saw five consecutive payrolls figures below the -700k mark starting from November 2008. Looking at the past fortnights jobless claims figures the April number and revisions to this release will paint an even bleaker picture of the labour market. In the household survey nearly 2.987mn jobs were recorded lost.
Trying to look beyond to what the day after looks like is important, particularly at a political level. Will it be a blow or a boost to the populists? In the US, France and Germany it looks like it will be a reminder to voters of the damage populists can do. There is a broad feeling that serious government is required.
Europe has, for the time being, become the focal point of coronavirus contagion. Its epicentre is Italy (Figure 1), which…