BlackRock Investment Institute

Macro insights

Delta variant - delay not a derailing

The spread of the highly transmissible Delta variant has caused renewed Covid-19 flare-ups around the world. In the UK, the variant already accounts for nearly 100% of infections and cases are still growing. Yet the advanced vaccine rollout appears to have weakened the link between cases and hospital admissions, allowing reopening to continue after a one-month delay.

Delta's different paces

Tracking the delta variant

Sources: BlackRock Investment Institute, with data from Outbreak.info. Notes: The chart shows the percentage of new sequenced cases attributed to the Delta variant, starting on the day where prevalence reached 5%.

In the U.S. and continental Europe, the Delta variant will likely reach peak transmission through the summer. Evidence so far suggests the spread in these regions may be less rapid than in the UK; we see vaccines similarly limiting hospitalizations. See the chart. We might see some delays in reopening, but we do not expect the restart to be derailed given the vaccine’s effectiveness.

Studies so far have shown that two doses of the vaccines have greater than 90% efficacy against hospitalization from the Delta variant. This supports our view of a broadening global economic restart.

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Elga Bartsch
Head of Macro Research
Read bio
Nicholas Fawcett
Macro Research

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