Head of U.S. Economics
BofA Global Research
As we feared, the virus is rising in the U.S. at a concerning rate. In the last 45 days, the average daily number of new coronavirus infections has doubled to around 71,000, eclipsing the summer peak.1 This is a 21% jump in just a week and greatly outpaces the 5.2% rise in daily tests over the same period. Hospitalizations and deaths are also on the rise, with the death toll climbing more than 11% from a week ago to more than 800 a day.
And it’s happening across the country, especially in the Midwest. We now have 43 states seeing a weekly rise in average daily infection numbers of over 10%. With growth in cases outpacing the growth in tests, the median positive infection rate across the 50 states and Washington D.C. is now around 7.4%, up from 6.2% a week ago.2
What does this mean for the economy? Greater risks that more cities and states will have to re-impose restrictions to stem the surge in infections and the rise in deaths. Some states have already done so: Illinois for instance has restricted dine-in service at bars and restaurants in four counties and Newark, New Jersey, has placed an 8pm curfew on nonessential businesses.
This is happening at a time when many of the weekly indicators of consumer behavior are only showing moderate growth. Mobility remains low, and the number of seated diners at restaurants on the OpenTable network is stagnant. Meanwhile, air travel and movie box office receipts remain significantly depressed compared to this time last year. We did see air travel show signs of life again over the summer and early fall, but it has since moved lower.
More restrictions put greater pressure on businesses, and especially small businesses, which are still working with about 20% less employees than they had before the pandemic. That said, job openings have recently picked up while jobless claims have edged lower. But, of course, the path of the virus poses a threat to the recent improvement in labor market indicators.
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- The COVID tracking project. 7-day moving average
- The COVID tracking project as of October 27, 2020
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