Coronavirus Watch: Optimism surge proves short lived
The sense of optimism at the prospect of widespread vaccinations in 2021 has been deflated by the discovery of more transmissible forms of coronavirus in the UK and South Africa, as well as the stuttering start to vaccination programmes in some advanced economies.
In our view, the new coronavirus variants are the bigger concern of the two developments. For now, our baseline assumption is that these mutations will not trigger another global lockdown. Nonetheless, the risks have grown, and it seems highly likely that it will not just be the UK and South Africa who are forced into relatively hard lockdowns due to the spread of these new variants.
The new strains only add to the importance of rapid, effective vaccination rollouts. But slow starts in some countries aren’t a surprise, reflecting a number of factors including a measured launch to monitor unforeseen side effects, initial logistical teething problems, and vaccine shortages.
Although governments may fall short of ambitious vaccination targets in the medium term, the recent constraining factors should lessen with time and vaccination rates should increase.
While we have lowered our global growth forecast for 2021 slightly in response to recent events and judge the downside risks to have increased, we still expect healthy growth this year. We will publish updated forecasts on January 12.