Head of U.S. Economics
BofA Global Research
Service spending normalizing
Virus case growth moderated this week, but we suggest a cautious reading of the data, as the Easter holiday likely led to distortions. Holidays tend to see less testing leading to fewer reported cases. Hospitalizations held steady, while deaths fell sharply over the past week, but both measures could have been affected by underreporting over the holidays as well. Data over the next few weeks should provide a better picture of the U.S. virus situation.
Meanwhile, the vaccination campaign did not appear slowed by the holiday. Willingness of individuals to take the vaccine will become more important over the next few weeks as many states move to allow eligibility to those over 16 years old. According to a survey from the Kaiser Family Foundation around 20% of respondents will only take the vaccine if required or will not take it at all, while around another 20% responded that they will “wait and see”.1
Even looking past the holiday impact, indicators suggest mobility is normalizing to pre-COVID levels. Air travel increased by 4.6% week-over-week in the latest reading, as the Easter holiday likely boosted the number travelers.2 And movie theaters even got a lift this week, as the release of Godzilla vs. King Kong likely supported box office sales.
While the virus data has turned marginally worse over the past few weeks, states are still easing restrictions and gradually progressing with reopening. The vaccination campaign and hospitalization rates will be important to monitor in the coming weeks as states look toward further reopening.
Please visit our Economics of Reopening webpage weekly for our latest insights.
1. Kaiser Family Foundation (KFF) COVID-19 Vaccine monitor
2. TSA Data