IN FOCUS6-8 min read

What the data tells us about the next phase of the Covid-19 pandemic

With economies continuing to reopen on both sides of the Atlantic, we look at what might be around the corner as we reach a new stage in the global pandemic.



Mark Ainsworth
Head of Data Insights and Analytics

What has been happening since the beginning of September in the US and UK?

The Delta variant of Covid-19 is key to understanding the current trends around the reopening of the global economy. Countries that were aiming for so-called “Zero Covid” have found that this strategy doesn’t work so well against a virus that spreads much faster and further than the original strain. Countries such as India, South Africa and the US, where the previous variants appeared to have become endemic, were then hit with a new wave of infections through the spring and summer. However, for those countries, it now looks like we’re at the end of that wave.

Although some economies are reopening, mobility and socialising haven’t yet returned to pre-March 2020 levels. This has an effect on the spread of the virus even if there are no legal restrictions on what you can do.

Fear levels are a useful gauge to track this. Our data shows that the percentage of people in the US who say that they’re fearful of Covid-19 is currently 55%, up from 35% in June. This will undoubtedly have a knock-on effect as people avoid fully participating in the reopened economy. Fear should fall as cases decline.

What trends have we seen in the UK that might be replicated in the US this autumn?

The UK was the first developed economy to be hit hard by the Delta variant and this gave other countries an idea of what Delta becoming prevalent would do in the middle of a vaccination programme.

A useful area of comparison is the regional differences in the UK. The UK saw increased infection levels peak in mid-July as a result of people meeting up during the Euro 2020 football matches in pubs and private homes. Meanwhile, Scotland saw something similar - but earlier - when its national team was knocked out of the tournament in the first stage.

Although this wave has since subsided, it initially caused concern for epidemiological modellers and the government, and the different fates of the two teams helped reveal how modellers make sense of the dynamics of the virus.

With the American football season restarting and full capacity stadiums allowed, it’s expected that this will lead to spikes in the number of new infections.

 -- A snapshot of the global economy in September 2021

Will new Covid-19 restrictions be imposed by governments on both sides of the Atlantic as we head into winter?

The journey now seems to be one of relaxing restrictions, especially with cases in the US cresting rather than continuing to climb.

Although infection rates vary, we would generally expect cases in the US to start falling from now on as the virus is running out of susceptible individuals to infect. In some countries such as Brazil, due to a high infection rate (which has led to a very high number of deaths) and a high vaccination rate, behaviours are virtually back to normal with very little in the way of restrictions.

Lockdown measures were necessary last year because virtually nobody had any form of immunity against Covid-19. However, with large numbers of countries combining vaccinations and natural immunity from prior infections, it is unlikely that healthcare systems will become overwhelmed in the same way again.

We may see numbers of cases go up and hospitals become stretched through the winter but there will be an effect from the population choosing to socialise and mix less, as we’re seeing now, which will help to slow infection numbers.

We can expect the change in the weather to have an effect. For example, we’re seeing cases in some of the Southern US states such as Louisiana and Florida start to fall from huge highs. Conversely, in states as West Virginia and Pennsylvania infections are starting to rise.

Covid-19 is an airborne virus, and it spreads best when people are breathing the same air. The summer in the south of the US is so hot that people socialise indoors with the air conditioning on, which helps to spread the virus. As the weather cools, they can return to mixing outdoors. For the same reason, the Northern US states will see cases rise – or fall more slowly – as it becomes too cold to see other people outside.

 -- How the post-pandemic recovery is increasing the bargaining power of labour

What is the risk of further mutations of the virus as we saw with Alpha and Delta?

This risk is very hard to quantify but all infectious diseases mutate when they are inside your body. This is a risk of having high levels of infection in a population: there are more opportunities for any virus to evolve. We can’t know if there is another variant down the road with the scale of advantage that Delta had over previous variants, but it is absolutely a risk.

Will booster jabs be necessary to get the US and UK back to normal?

Although there is evidence that immunity does eventually wane after being fully vaccinated, that is in the antibodies that are the “front line” of immune defence.

At the same time, there are T-Cells and B-Cells in the background that remember how to make those antibodies, which is why protection against death is still strong a long time after vaccination for most people.

There is a useful comparison with Hepatitis-B, where it has been clearly established that three doses of the vaccine are needed to have full immunity against that virus. The Delta variant does appear to be a virus that, like Hepatitis-B, needs a third dose in order to give enduring protection. However, pursuing this approach does present an ethical dilemma. Most developing nations do not have good vaccination rates now and there is an argument that those third doses should go to those who have yet to have a first vaccination. Nonetheless, to provide their populations with the best protection against Delta, governments will probably need to provide a third dose.

In terms of a pre-pandemic normal, many countries may need to increase hospital capacity long-term in order to take in winter waves of both Covid-19 and the flu at the same time.

 -- How are vaccine programmes progressing in emerging markets

What will happen to the countries who pursued a zero-Covid strategy?

There are two ways that a virus such as Covid-19 ceases to be a threat: firstly, it doesn’t exist in the country at all, and secondly there is enough immunity to control the virus and not have an impact on healthcare. However, the first strategy requires a country to essentially close the border to keep the virus out. It’s not an end strategy; the end strategy must be to have immunity as otherwise the country is essentially cut off from the rest of the world forever.

Countries which pursued zero Covid are in for a difficult time, both culturally and administratively, as they attempt to reopen to the rest of the world, as they will have no naturally acquired immunity and will be solely reliant on vaccines.

This article is issued by Cazenove Capital which is part of the Schroders Group and a trading name of Schroder & Co. Limited, 1 London Wall Place, London EC2Y 5AU. Authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. 

Nothing in this document should be deemed to constitute the provision of financial, investment or other professional advice in any way. Past performance is not a guide to future performance. The value of an investment and the income from it may go down as well as up and investors may not get back the amount originally invested.

This document may include forward-looking statements that are based upon our current opinions, expectations and projections. We undertake no obligation to update or revise any forward-looking statements. Actual results could differ materially from those anticipated in the forward-looking statements.

All data contained within this document is sourced from Cazenove Capital unless otherwise stated.


Mark Ainsworth
Head of Data Insights and Analytics


The value of your investments and the income received from them can fall as well as rise. You may not get back the amount you invested.