The writer is a public policy professor at the University of Cambridge The cheerful crowds appearing on many high streets across the UK this week as retailers were allowed to reopen have given some economists hope that consumer spending will bounce back and drive a recovery. So it might. The pile-up of household savings is estimated at about £180bn and some argue that more of this will be spent than would be usual in a recovery. We will all be raring to go out and shop, eat, drink and generally be merry about the easing of lockdown. Even if the aggregate figures show a vigorous recovery, though, they will be misleading. We are two nations, and only one will have scope for a roaring 2020s. To point out the obvious, people who have been able to work from home, spending less, for months will for the most part welcome the chance to get out and enjoy themselves. But many others do not have the money to do so, and indeed have amassed debts instead. For those freelancers who fell through the gaps in furlough and self-employment support schemes, or those on low incomes or newly unemployed, the headache will be how to climb back out of a financial hole. The Resolution Foundation has reported recently on the surge in universal credit claims and evidence that many of these new claimants are further in debt than they were before the pandemic, or behind on essential bills. A recent report from the parliamentary housing, communities and local government committee noted that about 800,000 people fell into rent arrears from March to December last year. Home buyers and people with credit-card debt and other loans have been able to apply for a payment holiday, but they will need to catch up with higher payments later. Many are worried about their credit score. How big a dampening effect this has on the economy will depend not only on how much high-street spenders splash out but also on whether government spending, investment and trade contribute to growth, and how quickly unemployment — the number of claimants climbed from 1.3m in February 2020 to 2.7m in the same month this year — falls. Even if the optimists are right, that leaves two big economic challenges. Read more here

The US has eclipsed a new milestone in its vaccine rollout, giving out more than 200m doses of Covid-19 shots around the country. The Centers for Disease Control and Prevention said the US has administered 202m jabs since the vaccination programme began in December, an increase of almost 4m compared with figures from the previous day. Nearly 128m Americans have received one or more doses, while 80m – 31 per cent of the adult population – are fully inoculated. More than 35m people over the age of 65 have completed their vaccination course, accounting for 65 per cent of the senior population. The data include 7.8m doses of Johnson & Johnson』s single-shot version of the vaccine, which was paused this week because of an investigation by health authorities into a small number of blood clot cases in individuals who received the jab. The BioNTech/Pfizer shot accounts for 105m of the doses administered so far, while 89m Moderna shots have been given. The US tally of administered doses has risen by 3.3m per day over the last week, compared with an average of 2.9m around the start of April.

Apple has temporarily closed its stores in Michigan, which has become the latest hotspot for coronavirus in the US. 「Due to current Covid-19 conditions, we are temporarily closing our stores in Michigan. We take this step with an abundance of caution as we closely monitor the situation,」 the company said on Friday in an emailed statement to the Financial Times. An automated phone voice message for the Michigan stores said they were closed until further notice and Apple did not say in its statement when it planned to reopen them. The stores will be open through the weekend for customers with existing orders or items to pick up. Apple took similar steps last summer and closed stores in several states such as Florida, Georgia, North Carolina and Texas as the south and west regions dealt with a surge in infections and hospitalisations. The company has regularly opened and closed stores across the country during the pandemic in response to changing local coronavirus metrics. The iPhone maker』s decision on Friday comes days after Governor Gretchen Whitmer resisted calls from top US public health officials to impose restrictions on businesses in an effort to bring Michigan』s latest wave of Covid-19 under control. Rochelle Walensky, director of the US Centers for Disease Control and Prevention, on Monday said Michigan should impose restrictions to curb its latest wave of infections. Over the past week, Michigan has tallied a cumulative 538 infections per 100,000 people, according to data on Friday from the CDC. That is the highest number of per capita cases over a seven-day period for any state, beating out second-ranked Rhode Island with about 303 cases per 100,000 people. Michigan has averaged about 77 new Covid-19 infections per 100,000 a day over the past week, according to the CDC, not far from its peak rate of almost 84 in early December. Whitmer said on Wednesday about two dozen hospitals in the state were at least 90 per cent full.

It could take a decade for Italy』s debt burden to return to pre-pandemic levels and the country is likely to remain in the red until 2040 「even in optimistic scenarios,」 ratings agency Fitch has said Italy』s government debt is expected to rise from 135 per cent of GDP in 2019 to almost 160 per cent in 2021, largely as a result of a pandemic-induced hike in borrowing. Fitch said Italy』s debt-to-GDP ratio, a key measure of indebtedness, could return to 2019 levels by 2030 if the country keeps to a balanced budget and the economy grows by 4 per cent each year. In a more pessimistic scenario, in which the southern European country』s economy grows by 1 per cent each year, debt levels are expected to return to pre-pandemic levels by 2086. That is even if the government runs a budget surplus of 2 per cent of GDP. 「The calculations indicate that at least 3 per cent nominal growth rate and primary budget surpluses are required to have a meaningful debt decline,」 Fitch said. The European Central Bank was in December urged by senior Italian officials to consider easing debt burdens by forgiving sovereign bonds it owns. Several countries, including France and Spain, are running budget deficits above 10 per cent of gross domestic product. The EU』s fiscal rules, which oblige member states to work towards the eurozone』s debt and deficit targets, were suspended for 2020 to 2022 in recognition of the need for large-scale fiscal stimulus to offset the pandemic』s impact.

Chile has released the results of a large-scale study of China』s CoronaVac vaccine, showing that it is 80 per cent effective at preventing deaths in people who would otherwise have died, and protects two-thirds of those who are fully immunised against infection. Chile』s experience is being closely watched because it is a world leader in vaccinations. It has inoculated 7.6m people, or half its target population, with at least one dose and 5.1m with a second dose. The south American nation is relying mainly on SinoVac』s CoronaVac vaccine, whose effectiveness has come under scrutiny after China』s top disease control official Gao Fu said last weekend that his country』s vaccines 「don』t have very high rates of protection」. He later said his comments had been misinterpreted. The Chilean health ministry concluded from its study that 「in a scenario of high epidemiological activity and in vulnerable groups, the vaccine studied [CoronaVac] protects against symptomatic infection by Sars-Covid-2, as well as against the most serious forms of the disease.」 The results showed that, two weeks after a second dose, the Chinese vaccine had prevented 85 per cent of hospitalisations and 89 per cent of intensive care transfers in those who would otherwise have had them. Concerns had been raised in Chile about a rapid rise in infections and hospital admissions over the past few weeks despite the extensive vaccination programme. However, health ministry figures showed that most of those falling seriously ill were under-50s, many of whom have yet to be vaccinated. The figures also underlined the importance of receiving both shots of the Chinese vaccine, with protection levels far lower after only the first dose.

Brazil has begun distributing an emergency batch of intubation medicines flown in from China, with hospitals around the country running out of vital supplies for treating Covid-19 patients on ventilators. As it grapples with a second wave of coronavirus that is deadlier than the first, Latin America』s largest nation is scrambling to secure medication for sedating people who require invasive mechanical breathing support. The situation has led to fears among medical professionals that patients could wake up while still intubated. An initial shipment of 2.3m intubation 『kits』, which contain sedatives, muscular neuroblockers and analgesic opioids manufactured in China, landed in São Paulo late on Thursday evening. They were purchased and donated to Brazil』s public health system by a group of companies including Petrobras, Vale, Engie, Itaú Unibanco, Klabin and Raízen. A further 1.1m kits are expected by the end of the month. The shortage follows Brazil』s difficulties obtaining adequate vaccine ingredients and doses, while earlier in the year oxygen canisters had to be airlifted to the Amazonian city of Manaus after it was overwhelmed by an explosion in Covid infections. Following criticism of president Jair Bolsonaro』s response to the pandemic, the country』s Senate this week launched a probe into his administration』s handling of the coronavirus crisis. So far 365,000 people have died from the disease in Brazil, the second-highest death toll after the US, or 11th on a per capita basis. The latest government figures showed new Covid cases decreased slightly to 73,174 over the previous 24 hours. Despite a fall in daily fatalities since hitting a record last week, the numbers were still elevated at 3,560. Intensive care wards in more than half of Brazil』s states have occupancy rates above 90 per cent, according to the biomedical institute Fiocruz.

The rate of new infections in England has slowed slightly since last week, according to the latest government figures, which suggest that every ten people with Covid-19 will infect between seven and 10 people. The R value, which represents the average number of people one person with Covid-19 is likely to go on and infect, has dropped marginally to between 0.7 and 1 from 0.8 to 1 the week before. The number of new infections in the UK is still shrinking, by between -6 and -1 per cent every day, according to the data, down from -4 to 0 per cent the week before. The R value and growth rate of new infections are being closely watched by scientists and government officials, who have said all further relaxations of lockdown restrictions will depend on infection rates remaining under control. Scientific advisers have warned it will take at least four weeks before the full effect of reopening sectors of the economy begins to show in data on the rate of infections. The growth rate and R number were highest in London, which had an R value of 0.8 to 1.1 and a growth rate of -5 to 0, and lowest in the North West and South East.

Moderna has warned that it will deliver fewer than expected vaccines to the UK, Canada and some other countries, after a shortfall in production in its European supply chain. The Boston-based biotech said on Friday that it will reduce the number of doses it is sending to the UK from April, impacting its target for the second quarter. Moderna manufactures vaccines for markets outside the US in a Swiss plant run by contract manufacturer Lonza, and fills vials for the UK and the EU in Spain.  「The trajectory of vaccine manufacturing ramp-up is not linear, and despite best efforts, there is a shortfall in previously estimated doses from the European supply chain,」 the company said in a statement. 「Vaccine manufacturing is a highly complex process and a number of elements, including human and material resources have factored into this volatility.」 The dip in supplies comes as deliveries of the Johnson & Johnson shot have been paused in the EU, and many countries have restricted who can receive the AstraZeneca vaccine, both because of concerns about a connection with a rare blood clotting side effect. In the UK, people under 30 years old were set to receive Moderna or BioNTech/Pfizer shots after guidance that they could be more at risk of the side effect.

Americans continued to grow more optimistic in early April, encouraged by the ongoing rollout of coronavirus vaccines and the arrival of fresh stimulus payments. The University of Michigan』s consumer sentiment index rose to 86.5, up from 84.9 at the end of the previous month and marking the highest reading since late March 2020. Improving economic conditions drove the index』s gains, particularly when compared to year-ago conditions that included the impact of coronavirus shutdowns. While consumers』 view of the economic outlook remained unchanged, half of respondents said they expected lower unemployment, the highest level ever recorded by the survey. Consumers 「reported surging economic growth and strong job gains due to record stimulus spending, low interest rates, and the positive impact of vaccinations,」 Richard Curtin, chief economist for the university』s consumer surveys, said. Data on Thursday showed that US retail sales jumped in March by the second-biggest margin on record, and jobless claims last week fell to their lowest level of the pandemic. 「Other factors suppressed the pace of expected gains, including persistent concerns with vaccine safety as well as a surge in year-ahead inflation expectations to 3.7 per cent, the highest level in nearly a decade,」 Curtin said. Consumer sentiment remains below pre-pandemic levels of 95.9 in early March 2020 and a final reading of 101 in February of last year. 「Today』s numbers jibe with March stimulus payments and strong spending, but also point to uncertainty about the economy later this year,」 Robert Frick, corporate economist at Navy Federal Credit Union, said.

Joe Biden』s administration will invest $1.7bn in federal funds to tackle Covid-19 variants, as public health experts warn that new strains of the virus could drive up infections even as more Americans are vaccinated. The White House announced on Friday that it was allocating $1.7bn from the American Rescue Plan, the $1.9tn economic relief package Biden signed into law last month, to fight the variants, the bulk of which will support increasing US capacity for genomic sequencing. Scientists use genomic sequencing to identify every gene in the virus, creating a series of letters. They then look for differences in the sequence and try to understand if these mutations change how the virus behaves.  Experts say US genomic sequencing capacity has lagged behind that of the UK, hampering American efforts to detect and respond to the emergence of new variants such as B.1.1.7, which was first detected in Britain last year and has now become the predominant strain in the US, according to the Centers for Disease Control and Prevention. By early December, the UK had tracked virus mutations in about 9 per cent of tests, according to the Covid-19 Genomics UK Consortium. The CDC said in late December that the US had sequenced only about 0.3 per cent of tests. The Biden administration on Friday said the funding would be allocated through the CDC to help the federal public health agency and state and local authorities track variants spreading throughout the US. The White House said $1bn would be spent on expanding genomic sequencing, with another $400m used to launch partnerships between state health departments and academic institutions, and $300m to beef up the data system that stores and shares information about the virus and its spread. Read more here

Angela Merkel has received the AstraZeneca vaccination, in a vote of confidence in a jab that is only being administered to over-60s in Germany. 「I'm glad that I received the first dose of AstraZeneca today,」 the chancellor said. 「I thank everyone who is involved in the vaccination campaign, and everyone who is being vaccinated.」 「Vaccination is the key to overcoming the pandemic,」 she added. Unlike some other world leaders, Merkel did not publish a photo of herself getting the shot: instead her spokesman Steffen Seibert tweeted a photo of her vaccination certificate. The German finance minister and deputy chancellor Olaf Scholz also received his AstraZeneca jab on Friday. 「Every vaccination brings the moment of us overcoming the corona pandemic closer,」 he tweeted.

The construction of new homes in the US hit its quickest pace in almost 15 years last month, rebounding more than expected from a snowy February that kept builders on the sidelines. Housing starts accelerated in March to a seasonally adjusted annual rate of 1.74m, a 19.4 per cent increase over February, the Census Department said on Friday. That was well ahead of the 1.61m forecast from economists polled by Reuters and marked the highest level since June 2006. In February, housing starts slipped 11.3 per cent as builders grappled with severe winter weather in Texas and other parts of the US. Homebuilders have also come under pressure from rising lumber and land costs, as well as mortgage rates that have edged up from record lows hit early this year. But robust home sales and a shortage of available properties have put new homes in high demand. Mortgage rates also remain historically low at an average of 3 per cent for 30-year loans, according to Freddie Mac data. 「Very low mortgage rates and families looking for more space are fueling demand and more than offsetting the impact of labor market turmoil and sharply higher prices,」 said Joshua Shapiro, chief US economist at MFR. Building permits, used as gauge of future construction, rose 2.7 per cent to an annual rate of 1.77m, compared with a February rate of 1.72m that was 8.8 per cent lower than January. Permits for only single-family homes were up 4.6 per cent. Analysts at Oxford Economics said they 「expect the pace of housing starts to moderate slightly over the balance of 2021」 but project a 6 per cent increase for the full year.

Australia has reported its first death from blood clots that were 「likely to be linked」 to side effects from a coronavirus vaccine. Four days after receiving the Oxford/AstraZeneca jab in New South Wales, a 48-year-old woman was admitted to hospital, where she died, with an extensive thromboembolic event and thrombocytopenia. The regulators』 investigation concluded that a causative link to the vaccine should 「be assumed at this time」, they said at a meeting late on Friday. The health department』s review of the case was complicated by the patient's underlying medical conditions, including 「diabetes, some other medical conditions as well as some atypical features」, the Therapeutic Goods Administration said. This is the third Australian report of a case of blood clots following an AstraZeneca vaccine. The first two cases are being treated in hospital and 「have been recovering well」.

Morgan Stanley has recorded a $911m hit from the blow-up last month of Archegos, Bill Hwang』s family office, which has caused billions of dollars of losses across global investment banks. The hit was a blemish on the Wall Street bank』s record first quarter, which was driven by a surge in dealmaking, trading and wealth management income. The quarterly earnings follow record profits in 2020, a jarring contrast with the havoc caused by the coronavirus pandemic. Shares, which have more than doubled from their pandemic low a year ago, have risen 18 per cent this year, outpacing the 11 per cent advance in the S&P 500. The US banking group on Friday reported a $644m credit loss and $267m of trading losses relating to 「a single prime brokerage client」, which a Morgan Stanley spokesperson later confirmed was Archegos. Morgan Stanley posted overall net income of $4.1bn in the fourth quarter, versus $1.7bn a year earlier, according to a filing on Friday. That translated into earnings per share of $2.19, beating analysts』 expectations for $1.72 a share, according to FactSet. We 「delivered record results」, said chief executive officer James Gorman. 「The integrated investment bank continues to thrive . . . [and] wealth management brought in record flows of $105bn. The firm is very well positioned for growth.」 Read more here.

Coronavirus infections have dropped across the UK, according to the national weekly survey, which is likely to bolster confidence in the government』s move to relax its latest lockdown this week. In England, an estimated 112,600 people tested positive for Covid-19 in the week ending April 10, equating to around one in 480 people, down from one in 340 people the week before, the Office for National Statistics said on Friday. Infections dropped in Wales (one in 920 people), Scotland (one in 500 people) and in Northern Ireland (one in 710 people). In England, the percentage of people testing positive decreased in Yorkshire and The Humber and the South East, while trends were less clear in other regions. Rates of infection decreased in every age group except for secondary school children and those aged 50 to 69 years old, where the trend was harder to ascertain. 「It is encouraging that across the UK we have seen a decrease in the percentage of people testing positive in the latest time period, with rates now similar to what we saw in early September last year,」 an ONS spokesperson said. 「Across England there was a mixed picture,」 the ONS said. 「Whilst we saw decreases in some regions, the majority of regions』 trends remain uncertain, underlining the continuing need for caution.」

Regular exercise can help to stave off the worst coronavirus symptoms, according to findings that have prompted researchers to urge governments and authorities to do more to encourage people to be active. A US paper, released this week, concluded that Covid-19 patients who were 「consistently inactive」 had a greater risk of hospitalisation, admission to intensive care, and death than those who regularly met physical activity guidelines. The findings, published in the British Journal of Sports Medicine, provide 「additional rationale and motivation」 for people to be more physically active and for communities to design environments that are more conducive to routine exercise, especially during the pandemic. 「Efforts should be made to enable and encourage regular physical activity as a means of protecting individuals from severe Covid-19 outcomes,」 the paper said. Coronavirus-induced restrictions have kept people at home, closed gyms and parks and constrained travel around the world, making it harder to motivate people to exercise. 「Consistently meeting physical activity guidelines was strongly associated with reduced odds for severe Covid-19 among infected adults,」 the paper said, especially when compared with those who were being consistently inactive. 「Even activity levels that did not meet guidelines were significantly associated with reduced odds of hospitalisation and death,」 the paper said. The study documented the health records of nearly 50,000 patients, who tested positive from January 1 to October 21 2020, in the two years up to the pandemic-induced lockdown of March 2020. US guidelines urge people to engage in at least 150 minutes a week of moderate to vigorous physical activity.

US government bonds steadied on Friday after a rally in the previous session, while stock bourses in Europe climbed to new peaks as investors weighed data from the world』s two biggest economies. The yield on the benchmark 10-year Treasury bond was flat at 1.583 per cent. The equivalent German bond yield added 0.02 percentage points to minus 0.28 per cent. Bond yields move inversely to prices. US retail sales rose in March by the most in 10 months while the number of Americans filing for new unemployment benefits fell to a post-pandemic low of 576,000 last week, figures published on Thursday showed. But Treasuries, whose fixed interest payments are eroded by inflation, were snapped up after the data were released, confounding analysts who normally would have expected the upbeat data to be bearish. The government bond market may be receiving a temporary boost, said Lombard Odier chief economist Samy Chaar, by haven buying after US president Joe Biden imposed sanctions on Russia and Chinese state-backed distressed debt manager Huarong Asset Management』s bonds plummeted in recent days. Dennis DeBusschere, head of portfolio strategy at Evercore ISI, noted that he had received a 「ton of questions」 from clients regarding the abrupt Treasuries move. Stock markets, which had rallied in the previous session in a reaction that Daiwa economist Chris Scicluna pegged to Thursday』s 「inexplicable decline in Treasury yields」, resumed their climb on Friday after China reported record quarterly GDP figures. Europe』s Stoxx 600 index rose 0.3 per cent, touching a new record high. The UK』s FTSE 100 index, which has large weightings of miners and energy producers, added 0.4 per cent, exceeding 7,000 for the first time. Brent crude, the international oil benchmark, added 0.4 per cent to $67.19. Read more here.

Ukraine received 117,00 doses of Pfizer/BioNTech coronavirus vaccines on Friday, the first of a delayed batch of free jabs provided through the World Health Organization-backed Covax facility. The shipment arrived at Kyiv』s airport as Ukraine faces rising Covid-19 cases and struggles to secure and swiftly administer vaccines to its 41m population. As of Friday, the country had administered at least one dose of the AstraZeneca vaccine to about 433,000 people, with 5 people having received the full two shots. Ukraine was sent 500,000 doses earlier this year. The eastern European country has also received 215,000 doses of the Chinese-made CoronaVac vaccine, the rollout of which began this week. It is only the second vaccine contracted by the government to have been delivered so far. UNICEF, which procures and supplies cost-free vaccines for Ukraine from different manufacturers through Covax, said in a statement that it expects to cover up to 20 per cent of the country』s population this year. 「Today, an important step was made to protect those who are at high risk of becoming seriously ill and even dying from Covid-19,」 said Lotta Sylwander, UNICEF』s representative in Ukraine. 「We hope for a quick and effective vaccination, otherwise people will continue losing loved ones and the medical system will remain overwhelmed,」 she added. Health minister Maksym Stepanov said the government hopes the majority of the population will have been vaccinated by the end of the year. Ukraine largely avoided the pandemic's first wave last spring, but cases have surged in recent weeks as lockdown restrictions have loosened. The virus has claimed the lives of 39,096 Ukrainians including 438 in the last 24 hours.

Investors are pumped up about US gym stocks. Shares in budget gym chain Planet Fitness have more than doubled over the past 12 months to trade near their pre-Covid-19 highs. Elsewhere, the parent company behind SoulCycle, the spin class pioneer, is reported to be in talks to merge with a blank-cheque company at a $7bn valuation. Yet banking on gyms and fitness centres to spring back once vaccines make them safe is premature.  The pandemic hit the US fitness sector hard. The industry generated just $15bn in revenue last year, a 57 per cent drop from the record $35bn in 2019, according to the International Health, Racquet & Sportsclub Association. Chains including Gold』s Gym, 24 Hour Fitness Worldwide and New York Sports Clubs owner Town Sports International were among those that filed for bankruptcy protection in 2020.  Meanwhile, at-home workouts have exploded as the coronavirus pandemic shifted workouts to living rooms and balconies.  Peloton, maker of pricey internet-connected exercise bikes, has been the biggest beneficiary of the trend. Revenues more than doubled to $1.8bn in the six months to the end of December. The stock, down more than a fifth since the start of the year, is still up 330 per cent since the start of 2020, to give the company a $36bn market valuation. Workout-from-home habits will not disappear overnight. One sample survey found that more than half of Americans who cancelled gym memberships during the pandemic do not plan to return. But gyms will not go the way of video renter Blockbusters either. Covid-19 has accelerated adoption of a hybrid model of online/in-person workouts that traditional gyms can retain even after the pandemic ends. SoulCycle has launched its own at-home bikes with virtual classes and started running outdoor classes. Gyms that can best marry the two for their endorphin-craving members will be in the best shape. Our popular newsletter for premium subscribers Best of Lex is published twice weekly. Please sign up here

The global number of Covid-19 cases detected per week has nearly doubled over the past two months, the director of the World Health Organization has said, with infection rates approaching the highest level since the pandemic began. 「Cases and deaths are continuing to increase at worrying rates,」 WHO director general Tedros Adhanom Ghebreyesus told a news conference on Friday. More than 4.5m cases were recorded worldwide in the week beginning April 5, the health body said, an increase of 11.8 per cent on the previous seven-day period. That shows infections have rebounded since more than 5m infections were reported in the week beginning January 4, at the pandemic』s peak. 「Some countries that had previously avoided widespread Covid-19 transmission are now seeing steep increases in infections,」 Tedros said. The situation in Papua New Guinea, which has reported more than 9,300 cases since the beginning of the year, was 「particularly」 concerning, he added. When 2021 dawned, the island nation in the Pacific had reported fewer than 900 cases and nine deaths, he said. Since then, it has registered 82 coronavirus-related deaths. 「While these numbers are still smaller than other countries, the increase is sharp and the WHO is very concerned about the potential for a much larger epidemic,」 Tedros said. Papua New Guinea had administered 197 vaccine doses by April 2, the WHO said. The country this week received 132,000 jabs from the Covax facility, a WHO-backed initiative to send Covid-19 shots to developing countries.