What Could Change China’s Zero-Covid?

We track scheduled flights (what’s planned) and tracked flights (what took off) from a sample of the largest airports across the world.

Looking at data up to 7 November:

• Global departures are down 6.4% from their Q3 peak, the downturn has accelerated over the past week (-3.0% WoW). With the number of global departures having trended about midway between 2019 and 2021 levels so far this year, there are strong signs that there is some way to go before normal levels are reached.
• Departures continued to climb from Beijing (+9.0% WoW) despite cases spiking countrywide (Chart A). The increase comes as rumours circled that China is weighing a gradual exit from zero-Covid. A serious hint that China is changing its stance could come in several ways:
  • 1) Official press highlighting reduced risks of the latest variant;
  • 2) Reclassification of Covid-19 as a Class-B disease – likely comes in tandem with a change in WHO stance who are due to meet in January;
  • 3) Increased vaccination of the elderly;
  • 4) Preparation of hospital system to absorb a large number of Covid-19 patients – Shanghai, for example, is building a quarantine facility that can house more than 3,000 people. Excluding China, departures across Asia jumped 5.1% WoW higher (Chart 2).
• Departures from Europe resumed their decline (-6.2% WoW) led by rapid a decrease from London Gatwick (-24.8% WoW) as UK half-term holidays concluded. Across Europe, only Madrid saw departures increase over the past week (+4.6% WoW). Departures from the US also fell (-2.6% WoW).

Information on long-term movements in flight data is available below.

US

UK

Italy

Spain

Germany

France

Canada

China

Japan

Hong Kong

South Korea

Singapore

Thailand

Bilal Hafeez is the CEO and Head of Research at Macro Hive. He spent over twenty years doing research at big banks – JPMorgan, Deutsche Bank, and Nomura, where he had various “Global Head” roles and did FX, rates and cross-markets research.

Ben Ford is a Researcher at Macro Hive. Ben studied BSc Financial Mathematics at Cardiff University and MSc Finance at Cass Business School, his dissertations were on the tails of GARCH volatility models, and foreign exchange investment strategies during crises, respectively.

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