TDSecurities with the note.
Covid cases in China have jumped, reaching close to 40k, with cases recorded in almost all provinces. Metro and road traffic congestion has fallen sharply in many cities as lockdowns and intensifying public caution results in much reduced mobility. Protests over the weekend highlighted frustrations over Covid policy, not helped by the implementation of measures to “optimise” Covid rules, which sowed confusion. Different interpretations of the measures in cities/provinces finally gave way to a renewed tightening of Covid restrictions.
Despite protests, we don’t think the government is about to open the doo rto a quick easing of Covid restrictions given 1) lack of boosters to the elderly population, 2) relatively low efficacy of China’s vaccines, and 3) limited ICU capacity. As such, many measures will likely stay in place but at the same time it is unlikely that China reverts to mass lockdowns and extremely tight mobility restrictions.
