With new infections falling sharply across the region and with lockdowns being eased, economic activity is starting to recover. However, the latest high-frequency data that we track, including routing requests from Apple and mobility data from Google, suggest that the recovery is proving slow going. This reflects three factors. Firstly, while lockdowns are being eased, strict social distancing measures remain in place in most countries. Korea recently ordered all bars and nightclubs and some schools to be closed after a spike in cases. Secondly, people are still worried about catching the virus, which is preventing them from resuming their normal lives. Even in Taiwan, which has just had just one reported case of coronavirus over the past week, time spent in retail & recreation venues is still down 12% from pre-crisis levels. The third factor is weak demand. The slump in economic activity has led to a sharp drop in employment across the region and labour market weakness will continue to drag on growth for some time to come.
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