Chart of the Week: Mobility in DM and EM countries in the time of COVID-19

Macro
Christopher Dembik

Head of Macroeconomic Research

Summary:  Our 'Macro Chartmania' series collects Macrobond data and focuses on a single chart chosen for its relevance. This week, we look at mobility data released by Google in its COVID-19 Community Mobility Reports. The data are available on Macrobond.


Click here to download this week's full edition of Macro Chartmania.

Google’s COVID-19 Community Mobility Reports are published on an ongoing basis, with the most recent statistics referring to the situation as it was two to three days ago (see here for further insights about the methodology).The two charts below show you the trend in terms of visits and length of stay in the retail and recreation sector at the end of last week both in developed and emerging markets. This sector is the most affected by the pandemic. It gives a real-time picture of the potential macroeconomic consequences of the re-introduction of restrictions in several countries to contain the spread of the variant Omicron.

Until one week ago, global mobility was generally improving. There was seasonal softness in Europe. But it was not worrying. European mobility was actually holding up relatively well. This was before the discovery of the new COVID variant Omicron. Mobility in Austria declined sharply following the re-introduction of a lockdown until 13 December. Visits to retail and recreation stores dropped 38% compared with the baseline in the week ending 26 November. Before the lockdown, mobility was low compared to other European countries. It was 18% below the baseline. The impact of the lockdown is, however, more limited than the lockdown which took place at the turn of the year in 2020. Mobility was down up to 73% in January 2021, for instance. In our sample for developed markets, Japan is the only country where mobility is back to pre-Covid level. From tomorrow, the country will close its borders to all foreigners again. But no further restrictions are introduced to limit mobility.

Europe is in a vulnerable position, in our view. The economic consequences of restrictions and lockdowns have diminished over time. But the continent is facing a perfect storm : the energy crunch, supply chain frictions, skyrocketing inflation and « pay me my worth » demands from workers on top of the fourth wave of the pandemic. GDP growth forecast in major European economies over the next three quarters has slowed over the last month, sliding to a six-month low in October. The risk of stagnation or recession has increased, especially for Austria and Germany. We are cautiously more optimistic for the other European economies. They seem less inclined to re-introduce strict restrictions and they are less exposed to the global trade turmoil. Think France or Italy.

In contrast, mobility in the largest emerging markets is back or above pre-COVID level. Taiwan is the only exception. Mobility was down 11% compared to the baseline in the week ending 26 November. The local policymakers and health authorities are reluctant to exit the zero COVID policy despite a very low number of new daily cases (12 cases on 26 November, for instance). Several emerging markets have been successful containing the recent evolution of pandemic until now (South Korea, India). Others are examples of « living with the virus » despite thousands of new cases daily and continuing deaths (South Africa, Brazil, Mexico). We have experienced the hard way that the situation can reverse fast with COVID. Uncertainties over the variant Omicron related to the transmissibility, vaccine effectiveness and risk for reinfections will push policymakers to be more careful than perhaps needed in the short term.

Quarterly Outlook 2024 Q3

Sandcastle economics

01 / 05

  • Macro: Sandcastle economics

    Invest wisely in Q3 2024: Discover SaxoStrats' insights on navigating a stable yet fragile global economy.

    Read article
  • Bonds: What to do until inflation stabilises

    Discover strategies for managing bonds as US and European yields remain rangebound due to uncertain inflation and evolving monetary policies.

    Read article
  • Equities: Are we blowing bubbles again

    Explore key trends and opportunities in European equities and electrification theme as market dynamics echo 2021's rally.

    Read article
  • FX: Risk-on currencies to surge against havens

    Explore the outlook for USD, AUD, NZD, and EM carry trades as risk-on currencies are set to outperform in Q3 2024.

    Read article
  • Commodities: Energy and grains in focus as metals pause

    Energy and grains to shine as metals pause. Discover key trends and market drivers for commodities in Q3 2024.

    Read article

Disclaimer

The Saxo Bank Group entities each provide execution-only service and access to Analysis permitting a person to view and/or use content available on or via the website. This content is not intended to and does not change or expand on the execution-only service. Such access and use are at all times subject to (i) The Terms of Use; (ii) Full Disclaimer; (iii) The Risk Warning; (iv) the Rules of Engagement and (v) Notices applying to Saxo News & Research and/or its content in addition (where relevant) to the terms governing the use of hyperlinks on the website of a member of the Saxo Bank Group by which access to Saxo News & Research is gained. Such content is therefore provided as no more than information. In particular no advice is intended to be provided or to be relied on as provided nor endorsed by any Saxo Bank Group entity; nor is it to be construed as solicitation or an incentive provided to subscribe for or sell or purchase any financial instrument. All trading or investments you make must be pursuant to your own unprompted and informed self-directed decision. As such no Saxo Bank Group entity will have or be liable for any losses that you may sustain as a result of any investment decision made in reliance on information which is available on Saxo News & Research or as a result of the use of the Saxo News & Research. Orders given and trades effected are deemed intended to be given or effected for the account of the customer with the Saxo Bank Group entity operating in the jurisdiction in which the customer resides and/or with whom the customer opened and maintains his/her trading account. Saxo News & Research does not contain (and should not be construed as containing) financial, investment, tax or trading advice or advice of any sort offered, recommended or endorsed by Saxo Bank Group and should not be construed as a record of our trading prices, or as an offer, incentive or solicitation for the subscription, sale or purchase in any financial instrument. To the extent that any content is construed as investment research, you must note and accept that the content was not intended to and has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such, would be considered as a marketing communication under relevant laws.

Please read our disclaimers:
Notification on Non-Independent Investment Research (https://www.home.saxo/legal/niird/notification)
Full disclaimer (https://www.home.saxo/legal/disclaimer/saxo-disclaimer)
Full disclaimer (https://www.home.saxo/legal/saxoselect-disclaimer/disclaimer)

Saxo Bank (Schweiz) AG
The Circle 38
CH-8058
Zürich-Flughafen
Switzerland

Contact Saxo

Select region

Switzerland
Switzerland

All trading carries risk. Losses can exceed deposits on margin products. You should consider whether you understand how our products work and whether you can afford to take the high risk of losing your money. To help you understand the risks involved we have put together a general Risk Warning series of Key Information Documents (KIDs) highlighting the risks and rewards related to each product. The KIDs can be accessed within the trading platform. Please note that the full prospectus can be obtained free of charge from Saxo Bank (Switzerland) Ltd. or the issuer.

This website can be accessed worldwide however the information on the website is related to Saxo Bank (Switzerland) Ltd. All clients will directly engage with Saxo Bank (Switzerland) Ltd. and all client agreements will be entered into with Saxo Bank (Switzerland) Ltd. and thus governed by Swiss Law. 

The content of this website represents marketing material and has not been notified or submitted to any supervisory authority.

If you contact Saxo Bank (Switzerland) Ltd. or visit this website, you acknowledge and agree that any data that you transmit to Saxo Bank (Switzerland) Ltd., either through this website, by telephone or by any other means of communication (e.g. e-mail), may be collected or recorded and transferred to other Saxo Bank Group companies or third parties in Switzerland or abroad and may be stored or otherwise processed by them or Saxo Bank (Switzerland) Ltd. You release Saxo Bank (Switzerland) Ltd. from its obligations under Swiss banking and securities dealer secrecies and, to the extent permitted by law, data protection laws as well as other laws and obligations to protect privacy. Saxo Bank (Switzerland) Ltd. has implemented appropriate technical and organizational measures to protect data from unauthorized processing and disclosure and applies appropriate safeguards to guarantee adequate protection of such data.

Apple, iPad and iPhone are trademarks of Apple Inc., registered in the U.S. and other countries. App Store is a service mark of Apple Inc.