The large majority of European countries have 'negative' momentum on covid cases now. But lockdown lite vs lockdown full makes a difference. We have big descents in France and the UK, vs mostly stabilization (but no strong descent) in Germany.
Also, we are still waiting for improvement (decline) in Germany's positivity ratio (hit ratio). We would expect Germany to eventually get on the path of Netherlands, with a clearer descent. But it is taking somewhat longer than expected.
The lockdown lite started 3 weeks ago, and it normally takes 2-3 weeks before results are visible. But the fact that policy makers are talking about extending the measures also shows that the descent has been surprisingly slow.
Germany is Europe's most important economy, and recent resilience in the data there has been a part of the narrative behind better growth sentiment. It matters to sentiment if Germany will have to implement tougher restrictions, or whether some easing is possible by Christmas.
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Second, it is not very helpful to have the Treasury and the Fed in open disagreement about this type of issue. This probably explains why markets reacted negatively.
There is a lag between cases & deaths, and as we see acceleration in cases, there is always a debate about whether fatalities will follow. That debate was there in the US second wave in the summer, in the European 2nd wave in recent weeks, & now again in the US 3rd wave
I will repeat a point I have made before. When I look at the momentum in COVID cases in Europe (proxy for Rt if you will) the most important thing to monitor now is whether 'lockdown lite' can work.
We know that full-blown lockdown will will work. But it is more interesting that the Netherlands, Germany and Denmark are getting case growth down notably by embarking on lockdown lite (shops remain open, restaurants are restricted (but not shut), mask mandate in public places)
The Netherlands has had negative (smoothed) case growth for 11 days. Denmark has had negative case growth for a few days. Germany is close to zero case growth (Rt=1) on the smoothed measure. But it growth actually turned negative on the non-smoothed daily metric, today.
The WSJ has a good overview of the record number of US COVID cases recorded in the latest daily data. They discuss the various factors contributing. But they do not mention weather/temperature. I think that is a mistake... @JenCalfas@bysarahkrouse