German Uptick Fuels Fears About European Virus Resurgence
Spain and Italy have shut nightclubs; Greece limited hours for bars and restaurants to try to avoid more drastic measures later.
(Bloomberg) -- Germany recorded the highest number of new coronavirus cases in nearly four months, fueling fears about a resurgence of infections across Europe.
Officials are already tightening restrictions on movement again in an effort to prevent summer partying and travel from spreading the disease. Spain and Italy have shut nightclubs and Greece limited hours for bars and restaurants to try to avoid more drastic measures after the holiday season winds down.
Governments are desperate to foster a recovery after activity collapsed in the second quarter, but a failure to act decisively to prevent a widespread resurgence could mean more pain for the economy later on. Officials in Austria and Ireland will discuss possible new restrictions later on Tuesday, while the Netherlands may reintroduce limits on numbers at group gatherings.
Tourist-reliant Croatia is feeling the sting of an uptick in Covid infections, which is raising concern over further countries introducing quarantines for those returning from holidays there. The latest figures showed the Adriatic Sea nation with 85 new cases on Monday after a record 208 on Friday.
After an exodus of Austrian guests over the weekend, who wanted to beat the virus travel warning effective from Monday, neighboring Slovenia may be next to ramp up measures. A key road transit route for European Union residents to Croatia’s sunny coast, Slovenia has been considering tightening its border regime and ministers have suggested that citizens return home as soon as possible.
“We agree that quarantine should be imposed for all returnees” from Croatia, Slovenian Health Minister Tomaz Gantar said late on Monday. The government in Ljubljana is expected to make a decision within days.
German Spread
Germany remains a primary concern. Credit risk advanced, with investors taking fright at the uptick in Europe’s biggest economy and most populous nation. An index of default risk on Europe’s highest quality companies rose and an equivalent measure for junk bonds also gained.
There were 1,693 new German cases in the 24 hours through Tuesday morning, the most since April 25, according to data from Johns Hopkins University. The number of daily cases reached almost 7,000 at the peak of the pandemic in the spring.
There have been a number of outbreaks in recent weeks in settings such as larger family events and leisure activities, as well as in educational and professional facilities, according to the country’s RKI public health institute.
Chancellor Angela Merkel said at a meeting of her CDU party in Berlin on Monday that rising infections are a concern, though manageable, and there is currently no scope for loosening curbs. The government may move to restrict social gatherings to close family members for the time being.
There are more encouraging signs elsewhere in Europe. Italy -- the original epicenter of the outbreak on the continent -- reported 320 new coronavirus cases on Monday, the lowest increase in a week.
France recorded 493 new infections Monday. While that was a sharp drop from a day earlier, the rise in new cases in recent weeks has prompted authorities to consider new measures, such as wearing masks in offices.
President Emmanuel Macron on Monday urged French citizens to remain vigilant. “In the weeks to come, we will have to continue fighting a health crisis which is taking another form,” Macron said. “The virus is accelerating again, so a lot of vigilance is required.”
Over the summer, local authorities sealed off some public areas such as beaches to prevent parties. Nightclubs have been closed since mid-March and a ban on gatherings of more than 5,000 people was extended until the end of October.
What Our Economists Say:
“In the first two weeks of August, activity declined in countries with renewed outbreaks, such as Italy, France and Spain. The recovery remains sluggish in Germany, Sweden and Norway.”
--Bjorn van Roye and Tom Orlik. Read their GLOBAL INSIGHT
Austria is discussing changes to its border regime after vacationers returning from the former Yugoslavia and Turkey were among the factors driving up daily infections to four-month-highs. Chancellor Sebastian Kurz may announce new measures after meeting with his health and interior ministers later on Tuesday.
Austria recorded 295 new infections on Tuesday, keeping the seven-day average at the level of mid-April. More than 2,200 Austrians currently have the virus, the most since the end of April and about six times more than in June.
In Ireland, government officials will meet to decide on new recommendations from health authorities. Older and vulnerable people are to be told to limit their time outdoors, the Irish Independent reported on Tuesday. Indoor family gatherings will be limited to six people, and outdoor home gatherings to 15 in an effort to curb parties, the newspaper said.
Amsterdam is expected to announce tighter measures on Tuesday, Dutch news agency ANP reported late Monday, citing Health Minister Hugo de Jonge.
Romanian Restrictions
In eastern Europe, Romania continued to struggle to contain the spread of the virus as social-distancing rules have been largely neglected during the summer holidays. Romania has surpassed 3,000 fatalities from Covid-19 after a record number of new cases last week.
The government extended restrictions to a total of 13 counties and the capital Bucharest, ordering outdoor restaurants and casinos to close at midnight. Romania recorded 1,014 cases on Tuesday, about two-thirds of last week’s peak.
Poland is also seeing a gradual decline in infections after a spike earlier in the month, with 597 new cases on Tuesday, while Ukraine registered 1,616.
Even in the Baltic states, which have been relatively less affected by the virus, authorities are clamping down. Estonia imposed stricter alcohol sales rules in a city which saw an outbreak, while Lithuania’s government is discussing reintroducing mandatory masks in outdoor public spaces.
In the Czech Republic, whose capital Prague is another tourist magnet, face masks will become obligatory in public indoor areas as of Sept. 1.
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