Covid-19 Facts & Figures: Omicron still spreading but economic damage is likely to prove limited
- The Omicron variant is spreading fast, with advanced economies currently most affected. It has lifted global daily infections above 3 million for the first time. The World Health Organization predicted that more than half of Eu-rope’s population will be infected with the Omicron variant within the next six to eight weeks.
- Increasing medical evidence shows that Omicron is much more infectious due to a mutated spike protein but seems to cause less severe illness than delta.
- As of January 18: 3 million 7-day average new cases, increasing from 2.6 million a week ago and 651,000 a month ago. Now confirmed 334 million cases worldwide. 5.55 million people have died (1.7% of cases) and 269 million have recovered (80.5%).
- Europe: 110m cases; 7-day average growth of 1.25m vs 1.18m a week ago and 365k a month ago. USA: 67m cases; 7-day average growth of 754k vs 747k a week ago and 130k a month ago.
- In response to the new wave, Europe has reacted most strongly in tightening restrictions, also causing several protests around the continent. China’s zero tolerance policy is increasingly questioned as disproportionate against new variant characteristics.
- Europe and US are ramping up booster efforts, with UK most advanced. Vaccines still seem effective in preventing severe disease/deaths, while only booster shots seem to help contain infections. The WHO said repeating booster doses of the original Covid-19 vaccines is not a viable strategy against emerging variants.
- Vaccines: around 9.75 billion doses have been administered globally, of which 529 million in the USA and 1.16 billion in Europe. 137 vaccines are in clinical evaluation and 194 vaccines are in preclinical evaluation. Globally, 878 million booster doses have already been administered, of which 80 million in the USA and 225 million in Europe.
- We assume that Omicron will facilitate a shift from a pandemic to an endemic situation. The key risk lies in new variants making the virus more lethal again – a thin tail risk in our view considering the progress in the vaccination campaign and the new drugs for treating Covid-19. Omicron is causing another speed bump in Q1, but the eco-nomic damage is likely to prove more limited than from earlier waves.
- The zero-Covid policy in Asia is likely to delay the normalisation of the global supply chain and fan near-term inflation pressure. The market focus has rightly shifted from Covid to central banks, with the increasingly hawkish Fed likely to keep the pressure on bond yields and financial volatility.