World Health Organization (WHO) Director-General Tedros Adhanom Ghebreyesus attends a news conference organized by Geneva Association of United Nations Correspondents (ACANU) amid the COVID-19 outbreak, at the WHO headquarters in Geneva Switzerland July 3, 2020.
Fabrice Coffrini | Pool | Reuters
The World Health Organization is urging the public to practice Covid mitigation tactics – including masking and distancing – regardless of vaccination status as cases surge across Europe heading into the holiday season.
Some countries and communities have been lured into a “false sense of security” that the pandemic’s over and the vaccinated are fully protected against Covid, WHO Director-General Dr. Tedros Adhanom Ghebreyesus told reporters during an update Wednesday in Geneva.
He noted that Covid vaccines “save lives” and lower the risk of severe disease and death, but the vaccinated can still contract and spread the virus as social mixing returns to pre-pandemic levels.
“Even if you’re vaccinated, continue to take precautions to prevent becoming infected yourself, and to infecting someone else who could die,” Tedros said. “That means wearing a mask, maintaining distance, avoiding crowds and meeting others outside if you can, or in a well-ventilated space inside.”
Tedros called Europe “the epicenter of the pandemic,” with “unsustainable pressure” facing both health-care systems and personnel. Europe represented 67% of the world’s total new Covid cases during the week ended Nov. 21 with more than 2.4 million infections, an 11% increase from the previous seven days, according to the WHO’s most recent weekly epidemiological update.
The WHO’s office covering Europe and Central Asia said Tuesday that those regions have surpassed a combined 1.5 million Covid deaths and could suffer 700,000 more fatalities by March 2022. The organization expects that intensive care units in 49 of the region’s 53 countries could experience high or extreme stress over the next four months.
Governments rolling back public health measures are fueling Europe’s current outbreak, said Dr. Mike Ryan, executive director of the WHO’s Health Emergencies Program.
“In Europe, even in the midst of a very, very strong resurgence in cases, and even in the midst of some of those countries under huge pressure in their health systems, we’re seeing pre-pandemic levels of social mixing, gathering and many other things,” Ryan said. “And the reality is the virus will continue to transmit intensely in that environment.”
Though the majority of reported Covid cases worldwide are in Europe, Tedros added that “no country or region is out of the woods” just yet. But expanding vaccination coverage, wearing masks, using distancing, and improving ventilation indoors can help drive down Covid transmission without resorting to lockdowns heading into the holiday season, said Maria Van Kerkhove, the WHO’s technical lead on Covid.
Covid infections are also rising in the U.S., with more than 95,000 new cases reported daily on average, according to data from Johns Hopkins University. More than 1,100 people are dying a day in the U.S. from the virus on average, according to Hopkins.
More than 51,000 Americans are currently hospitalized with Covid-19, according to a seven-day average of Health and Human Services data as of Wednesday, up 7% over the past week.
Dr. Scott Gottlieb, former head of the U.S. Food and Drug Administration and a Pfizer board member, told CNBC that more vaccinated people are contracting the virus than people realize due to weak monitoring of breakthrough infections in the U.S.
“At this point I think we need to accept that there’s a lot of breakthrough infections happening, particularly people who are out a significant portion of time from their original vaccination,” Gottlieb said. “There’s going to be retrospective studies that identify this, but we’re not doing a good job of tracking this in real time. And this is the argument for people to go out and get boosters,” he said.
The U.S. cleared Pfizer and Moderna boosters for all adults on Friday. Johnson & Johnson boosters were cleared by the Centers for Disease Control and Prevention in October. The WHO has criticized the broad distribution of boosters in wealthy nations because people in poorer countries have very limited access to vaccines.
The Netherlands entered a partial lockdown on Saturday, while Austria’s fourth full Covid lockdown began on Monday, with a nationwide vaccine mandate taking effect Feb. 1. Germany is also weighing whether to introduce a lockdown as the country’s seven-day new case average reached a record-high of more than 53,100 per day on Tuesday, up 29% from the week before, according to a CNBC analysis of data from Johns Hopkins University.
The White House on Monday said the Biden administration has no plans for a lockdown, pointing to rising vaccination rates and new therapeutic treatments that are coming online. The U.S. government has purchased 10 million courses of Pfizer’s Covid treatment pill, Paxlovid, which demonstrated high efficacy in preventing hospitalization during a clinical trial.
“We can curb the spread of the virus without having to in any way shut down our economy,” White House coronavirus response coordinator Jeff Zients told reporters during a briefing. “We have 82% of people now with one shot and more and more people getting vaccinated each week.”
European Central Bank heads into pivotal meeting with omicron infections rising
Christine Lagarde, president of the ECB, speaks at the Bank’s press conference in Frankfurt, Germany.
Boris Roessler | picture alliance | Getty Images
With inflation surging and the omicron Covid variant expected to spread through the region, the European Central Bank has the unenviable task of presenting its policy outlook for 2022 on Thursday.
The rise in the cost of living for the euro area (the 19 nations that share the euro) reached a record high of 4.9% in November, while omicron looks likely to become the dominant coronavirus strain with some European economies already locked down due to the delta variant.
“The sharp rise in infections and inflation and the emergence of the new Omicron variant has complicated the picture to an extent that the Governing Council may need more time to decide on all the details of adjusting its non-conventional policy tool,” said Dirk Schumacher, an ECB watcher with Natixis, in a recent research note.
The institution led by Christine Lagarde developed a new bond-buying program in the wake of the coronavirus in March 2020 to support the euro zone. The PEPP is due to end in March 2022 with a potential total envelope of 1.85 trillion euros ($2.19 trillion).
The ECB has also kept its asset purchase program, known as APP, amid the pandemic which has a current monthly pace of 20 billion euros. The central bank has been using this program in combination with PEPP to sustain the 19-member economy.
Schumacher added that Natixis still expects an announcement that the PEPP program will end by March and “we expect a clear signal that the APP will be used in a more flexible way.”
A big focus of this week’s meeting will be the new staff projections for inflation and growth. They show whether the inflation target of 2% will be met over the medium term, which is ultimately ECB’s primary mandate.
“I see an inflation profile which looks like a hump. So it has clearly increased over the last three quarters and we know how painful it is,” Lagarde said at a Reuters conference on Dec. 3,
“And a hump eventually declines and this is what we project for 2022,” she added.
Another key question is how the ECB will bridge the end of the PEPP program at the end of March into a more flexible and potentially larger APP without provoking major market volatility and keeping financial conditions on “favourable” terms. The ECB is expected to stress the need for flexibility.
“Flexibility, in our view, means varying purchases depending on the inflation outlook and financing conditions, i.e. preserving the principle of ‘favourable financing conditions’ that characterises the PEPP,” Spyros Andreopoulos, a senior European economist at BNP Paribas, said in a note.
“This view has been supported by recent ECB rhetoric that has emphasised the need to maintain flexibility, as opposed to pre-committing to a fixed volume of purchases.”
UK inflation hits 10-year high ahead of key Bank of England meeting
Shoppers wearing protective face masks walk through the rain on Oxford Street in London on June 18, 2020, as some non-essential retailers reopen from their coronavirus shutdown.
Tolga Akmen/AFP/Getty Images
LONDON — U.K. inflation climbed to a 10-year high in November as consumer prices continued to soar ahead of the Bank of England‘s crunch monetary policy meeting on Thursday.
The Consumer Price Index rose by 5.1% in the 12 months to November, up from 4.2% in October, which was itself the steepest incline for a decade and more than double the central bank’s target.
Economists polled by Reuters had expected a reading of 4.7% for November, and the Bank of England had projected that inflation would hit 5% in the spring of 2022 before moderating towards its 2% target in late 2023.
On a monthly basis, U.K. inflation rose 0.7% in November from October, above a Reuters poll for a 0.4% increase.
Core CPI, which excludes volatile energy, food, alcohol and tobacco prices, rose by 4% year-on-year against a Reuters forecast of 3.7%, and 0.5% month-on-month versus a 0.3% projection.
The Bank of England’s Monetary Policy Committee meets Thursday to decide whether to tighten monetary policy, with inflation surging and the labor market remaining robust, but the rapid spread of the omicron Covid-19 variant has cast fresh uncertainty over the economic recovery in the short term.
The MPC defied market expectations in November by voting 7-2 to hold interest rates at their historic low of 0.1%, but analysts are split on whether it will pull the trigger on rate hikes on Thursday in light of the emergence of omicron.
“Unfortunately for consumers, peak inflation may still be a few months off. Today’s CPI data only serves to increase the pressure on the Bank of England to raise interest rates at its MPC meeting tomorrow,” said Richard Carter, head of fixed interest research at Quilter Cheviot.
“However, the Bank of England may well decide that discretion is the better part of valour and instead opt to wait until next year given the current uncertainty surrounding the impact of the Omicron variant on the economy, coupled with the risk that further restrictions may need to be introduced before long.”
Most Chinese companies could delist from US, says TCW Group
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Chinese companies listed on Wall Street will likely to be cut off from U.S. capital markets in the next three years as tensions between Beijing and Washington persist, says one global asset management firm.
“I think for a lot of Chinese companies listed in U.S. markets, it’s essentially game over,” David Loevinger, managing director for emerging markets sovereign research at TCW Group, told CNBC Wednesday. “This is an issue that’s been hanging out there for 20 years — we haven’t been able to solve it.”
TCW Group had $265.8 billion in assets under management as of September 30, 2021, according to the company’s website.
The U.S. Securities and Exchange Commission this month finalized rules to implement a law that would allow the market regulator to ban foreign companies listed in the U.S. from trading if their auditors do not comply with requests for information from American regulators.
The law was passed in 2020 after Chinese regulators repeatedly denied requests from the Public Company Accounting Oversight Board to inspect the audits of Chinese firms that list and trade in the United States.
Given the current level of distrust between the U.S. and Chinese governments, and with the bilateral relationship unlikely to improve anytime soon, there is “no way we are going to solve this in the next few years,” Loevinger said.
“So the reality is, I think, by 2024, most Chinese companies listed on U.S. exchanges are no longer going to be listed in the United States. Most are going to gravitate back to Hong Kong or Shanghai,” he told CNBC’s “Street Signs Asia.”
Less than six months after going public, Chinese ride-hailing giant Didi said it will start delisting from the New York Stock Exchange, and make plans to list in Hong Kong instead.
When a company delists from an exchange like the Nasdaq or the New York Stock Exchange, it loses access to a broad pool of buyers, sellers and intermediaries.
Chinese regulators were reportedly unhappy with Didi’s decision to list in the U.S. without first resolving outstanding cybersecurity concerns. Regulators told the firm’s executives to come up with a plan to delist from the U.S. due to concerns around data leakage, according to reports.
Beyond Didi, many of China’s top internet companies listed in the U.S. have already undertaken dual listings in Hong Kong. Some high-profile names include e-commerce giant Alibaba, its rival JD.com, search engine giant Baidu, gaming firm NetEase and social media giant Weibo.
“We have already hit the turning point,” Loevinger said, pointing to Didi’s delisting announcement. “I just don’t think China’s government is going to allow U.S. regulators to have unfettered access to internal auditing documents of Chinese companies.”
“And if U.S. regulators can’t get access to those documents, then they can’t protect U.S. markets from fraud,” he added.