ISA Coronavirus Update (18th of June)

Daily Summary

Over the past two days alone, the number of new cases of the coronavirus that have been found around the world was more than 284,000, the highest two-day total of new cases of the virus so far during the pandemic. This brought the total number of cases of the coronavirus around the world to more than 8.4 million.

According to research from the BBC, the official death toll from the pandemic (451,000) understates the actual number of deaths from the coronavirus around the world by at least 130,000.

The number of new cases of the coronavirus being diagnosed in India has surpassed 10,000 for each of the past eight days, and the actual number of cases of the virus in that country is likely many times higher than the official figure.

There was a surge in the number of new cases of the coronavirus in Germany after hundreds of cases were discovered in a slaughterhouse in the northern German town of Gutersloh.

South Africa has one of the fastest-rising number of cases of the coronavirus of any country in the world and is home to 30% of the official number of cases in Africa, despite being home to less than 5% of that continent’s population. Most of these cases in South Africa have been concentrated in the Western Cape province.

Key Developments

Devastation for Government Finances: One area where the economic impact of the pandemic will be most noticeable is on government finances, with national and local governments recording sharp declines in revenues this year, while spending has increased thanks to massive stimulus programs.

US Retail Sales Bounce Back: Retail sales in the United States bounced back from a sharp decline in April to grow by a record 17.7% in May.  This was a much larger increase in retail sales than had been expected.  Still, US retail sales remain well below where they were prior to the pandemic.

Trend to Watch

The recent outbreaks in places where the pandemic seemed to be waning (such as China and Germany) show just how difficult it will be to re-open the economy without a new surge in the number of coronavirus cases being found.

The Coming Days

Over the next few weeks, a series of national elections will take place, many of them in Eastern Europe,  This includes elections in Poland, Serbia and Croatia, as well as a constitutional referendum in Russia. Some fear this could lead to new outbreaks.