Worldwide coronavirus cases surpass 25.6 million with over 854,000 official deaths.
Auckland shifted to level 2 Monday morning – actually level 2.5 as our restrictions are slightly different to the rest of the country’s level 2 old school level. Gatherings are limited to 10 people and 50 in cases of Tangi’s or funerals. The wearing of masks is now compulsory on all public transport and encouraged while in public spaces. Globally the virus has surpassed 25.3 million total cases as the USA then Brazil and India clock up the most cases. It won’t be long before India given the sheer number of people could bypass the USA’s 6.2million. It is said that for each week NZ is at a level 3 lockdown with the rest of NZ at level 2 this costs the NZ Govt around 300M per week economically which is approx 0.5% of GDP.
The good news is the economic cost was far less than initially forecast under lockdown. Not only that, the economy bounced back quicker than thought from the first lockdown with consumer spending and the number of people employed returning to pre- Covid levels. Another point of note which is hotly debated especially in the business community is the elimination approach compared to the other countries following more of a “controlled” approach and how by instigating stricter lockdowns much earlier than other countries stopped the spread of the virus allowing the economy to recover back to near “normal” status quicker. At the current restrictions we can expect to be down approximately 3% of standard domestic economic activity.
The Federal Reserve unanimously approved a shift to their inflation goal of 2.0%. The Fed will target an “average” inflation rate of 2.0%. This is a move which will see lower borrowing costs for some time. This won’t lead to any significant changes to the way the Fed is currently running monetary policy. It could put the Fed in a tight spot if inflation was to deteriorate as they have no road to go down from a monetary perspective and must rely on “fiscal” relief. The US Dollar underperformed into the weekly close and should continue to experience stress as the currency loses its yield edge. US unemployment claims Friday came in reasonably benign at 1006K or roughly 1M people filing for unemployment for the week ending 23 August with a high number of coronavirus cases still being reported and the end of the $600.00 supplementary benefit ending the main drivers.
Key Points:
- President Trump is considering bypassing US regulations and fast-tracking experimental coronavirus vaccines. Under review is the vaccine being developed by AstraZeneca/Oxford
- Victoria’s Melbourne stage 4 lockdown could be extended beyond the 13th September deadline if numbers don’t start coming down, over the weekend numbers dipped below 100 per day for the first time in two months
- Abbott Laboratories have gained emergency clearance from the FDA (Food and Drug Administration) to roll out BinaxNOW Covid-19 test- this will sell for USD $5.00 with results turnaround within 15 minutes. No equipment is necessary to carry out the test and it could be rolled out to schools and workplaces in efforts for US authorities to mass test