ABN Amro mener, der er risiko for skrappere restriktioner for at bekæmpe stigningen i corona-smitten. Det kan i sidste ende før til en ny lockdown-bølge i de europæiske lande, men indtil videre vil en stramning snarere bestå i, at regeringerne vil sikre sig, at de eksisternde regler følges. I de seneste måneder har restriktionerne ligget stabilt for Europa som helhed, mens der har været skrappere restriktioner i Frankrig og en reduktion i Tyskland, Italien, Spanien og Belgien.
How far has the re-opening of economies been reversed?
Euro Macro: At the eurozone level, exit process has stalled but not yet reversed –
Given the second wave of Covid-19 cases, a number of governments in the eurozone have announced new measures to try and control the spreading of the virus. This follows a lifting of broader lockdown measures earlier in the year when new case numbers plummeted in many countries.
How far has the exit process reversed? The best-known indicator of the degree of economic restriction is the University of Oxford’s Stringency Index. We show the index in the charts below for the six largest eurozone member states.
As can be seen from the charts, four member states (Germany, Italy, Spain and Belgium) continue to see restrictions easing, albeit very mildly. Meanwhile, France has seen a modest stepping up of restrictions, while the Netherlands is the only large economy that has seen a significant re-introduction of restrictions, though the index remains much lower than its peak.
Stringency Index
Source: Oxford University, ABN Group Economics
Stringency Index
Source: Oxford University, ABN Group Economics
We have created a eurozone aggregate Stringency Index based on the Oxford individual country data (see chart below). Following a significant lifting of restrictions over the summer, the index has been flatlining over the last month or so. We thing this suggests that the exit process has stalled, rather than significantly reversed at this stage.
Stringency Index
Source: Oxford University, ABN Group Economics
What are the implications for the economy? This is good news for current activity levels, but very much of the ‘it could be much worse’ variety. There are a number of reasons for caution and why we maintain conviction in our double dip scenario for the eurozone economy.
First, the trend appears to be towards new restrictions going forward. Italy imposed new restriction overnight and France, the Netherlands and Ireland may follow this week. Having said that, at least according to reports in the press, the measures being discussed are relatively modest (with the exception again of the Netherlands).
Right now governments might more focused on the signalling effect of new measures (to make it clear to people that they need to stick to existing rules) rather than seriously ramping up restrictions. Having said that, if that does not work, more significant and widespread restrictions may follow.
Secondly, the second wave of new Covid-19 cases remains very much in place. In some countries the trend still looks to be accelerating, while in others it is hovering at high levels. This could force the hand of governments.
Even if it does not, it could add to caution amongst households and businesses.
Third, second round effects from the initial economic shock – such as a deteriorating labour market – will continue to weigh on the economy.
Fourth, the stagnation of the exit process will also be a headwind, in the sense that the growth spirt from the lifting of lockdowns has lost considerable momentum (this has been evident in the PMI surveys for August and September and today’s ZEW index for October).
Finally, until a vaccine is available and rolled out (we assume this will be the case until mid-2021) a further significant lifting of restrictions is unlikely.
