The US Federal Reserve Chairman says that a full economic recovery may take well over a year, and it may be dependent on a Covid019 virus becoming available.
That isn’t a surprising prediction, as a return to unrestricted international travel is likely to also depend on a vaccine. Travel affects business, especially tourism. Airlines that survive may it difficult to get back previous levels of business if social distancing remains required.
Reuters: Fed’s Powell says full economic recovery may require coronavirus vaccine
Federal Reserve Chairman Jerome Powell said a U.S. economic recovery may stretch deep into next year and a full comeback may depend on a coronavirus vaccine.
“This economy will recover. It may take a while … It could stretch through the end of next year. We really don’t know,” Powell said in remarks aired on CBS’s “Face the Nation”.
“Assuming there is not a second wave of the coronavirus, I think you will see the economy recover steadily through the second half of this year. For the economy to fully recover people will have to be fully confident and that may have to await the arrival of a vaccine.”
Like governments a lot of businesses will need to rely on borrowing to survive, and that could be a burden for years.
The world economy is in part reliant on the US economy, as is New Zealand’s economy. We have done a lot of travel to and through the US, and a lot of business with them.
Covid deaths have now passed 90,000 in the US, with trends indicating that wil reach well over 100k by the end of May and still climbing into June – see Where The Latest COVID-19 Models Think We’re Headed
Reuters: So far, no spike in coronavirus in places reopening, U.S. health secretary says.
U.S. authorities are not yet seeing spikes in coronavirus cases in places that are reopening but it was still too early to determine such trends, health secretary Alex Azar said on Sunday.
“We are seeing that in places that are opening, we’re not seeing this spike in cases,” Azar said on CNN’s “State of the Union” program. “We still see spikes in some areas that are, in fact, closed.”
However, Azar said identifying and reporting new cases takes time. A critical part of reopening will be surveillance of flu-like symptoms in the population and other hospital admissions data, as well as testing of asymptomatic individuals, he said.
“It’s still early days,” Azar cautioned in an interview with CBS’ “Face the Nation.” He said data will take some time to come in from states that reopened early such as Georgia and Florida.
There are now 315,000 deaths currently recorded world wide. It is difficult to predict what the trends are going to be over the next few months as US states as well as countries start to cautiously reopen.
Some countries have increasing problems, like Brazil and Mexico, and Russia is now second to the US in number of cases, but with an extraordinarily low number of deaths recorded.
Two of the worst hit countries are at lowering rates – Spain and Italy record lower death tolls
Spain has recorded its lowest death toll in two months with 87 deaths in 24 hours, while Italy recorded its lowest daily toll, 145, since lockdown was declared.
It was the first time that Spain announced under 100 deaths in a day since mid-March, which could be due to a delay in reporting over the weekend, the health emergency coordinator said.
Prime Minister Pedro Sanchez said on Saturday that the government would request to extend the state of emergency for another month as the country continues to phase out restrictions on movement amid the coronavirus pandemic.
The state of emergency was set to end on May 24.
Declaring the lowest number of daily deaths since 9 March, Italy is now looking to bring forward the reopening of some commercial activity in the country, with retailers, hairdressers, salons, restaurants and cake shops authorised to open from tomorrow.
Spain has been relaxing stringent restrictions over the lats week. But weekend numbers are lower then weekday numbers.
DW: Brazil overtakes Spain, Italy in COVID-19 cases
Brazil overtook Spain and Italy in the number of confirmed COVID-19 cases on Saturday, making it the fourth-largest outbreak in the world.
The country’s total number of cases rose to 233,142 after authorities logged 14,919 new cases, according to data form Brazil’s Health Ministry.
A total of 15,633 people have died due to the coronavirus in the country so far, with the country registering 816 new fatalities over the past 24 hours.
Experts have warned that due to under-testing, the actual figures could be as much as 15 times higher, cautioning that the worst could be yet to come.
Despite the rising case numbers and fatalities, Brazilian President Jair Bolsonaro has repeatedly downplayed the seriousness of the outbreak, dismissing the virus as a “little flu.”
He has also continued to attack lockdown measures implemented by some governors to contain the spread of the virus, and calling for businesses to reopen
“Unemployment, hunger and misery will be the future of those who support the tyranny of total isolation,” the far-right president tweeted.
RNZ: Brazil’s Bolsonaro sees second health minister quit
Brazil’s health minister has resigned after less than a month in the job following disagreements over of the government’s handling of the country’s escalating coronavirus crisis.
At his news conference, Teich did not reveal why he had stepped down. He just thanked President Bolsonaro for giving him the chance to serve as a minister and praised healthcare workers.
But he has clashed with the president over several aspects of how the government has dealt with the spiralling epidemic.
He disagreed with the president’s desire to widely use chloroquine as a treatment. The drug has gained widespread attention although the World Health Organisation (WHO) says there’s no definitive evidence it works.
Teich also butted heads with the president over plans to open up the economy, saying last week that he was not consulted ahead of an order that paved the way for gyms, beauty salons and hairdressers to reopen.
Case and death rates are increasing in Brazil.
A study comparing Denmark and Sweden claims that most of the drop in consumer spending is due to the virus itself and not the lockdowns. Newsroom: New paper calls into question benefits of Swedish strategy
Economists at the University of Copenhagen have found lockdowns have had little impact on consumer spending habits and that the true dampener of purchasing activity is the coronavirus itself.
The findings of the preprint paper, which may not have been peer-reviewed, call into question the premise of the much-touted Swedish strategy, in which the Nordic country has shied away from entering lockdown, suffering thousands of deaths as a result, in order to preserve the economy.
Transaction data for 830,000 Danes and Swedes from the second-largest Scandinavian bank found aggregate spending dropped by 25 percent in Sweden and 29 percent in neighbouring Denmark, which instituted a lockdown. Denmark has had 10,713 cases of Covid-19 and 537 deaths, while Sweden has seen 28,582 cases and 3529 deaths.
“In Denmark, spending drops sharply around the shutdown on 11 March 2020 and remains below the level in the reference period,” the researchers write.
“In Sweden, spending drops sharply at almost the exact same time although no significant restrictions were imposed. Presumably, this is no coincidence but reflects that the Danish shutdown responded to an escalating pandemic, similar in the two countries, with its own strong effect on spending. This highlights the empirical difficulty of separating the effects of social distancing laws and the pandemic they are designed to contain.”
In their conclusion, the economists argue that the lockdown resulted in just a 4 percent decrease in spending and that the virus itself was to blame for the vast bulk of the economic slump.
With no sign of a vaccine keeping the virus in check and getting economies back in action may be a long slow process.
