Economic Wave Rolls Across Australia From Ground Zero, Melbourne

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A tram passes Flinders Street railway station in Melbourne on June 22.

Photographer: Carla Gottgens/Bloomberg

Photographer: Carla Gottgens/Bloomberg

Melbournes renewed lockdown and nighttime curfew are wiping out the recovery that was underway and risks broader erosion across Australia that could discourage households from spending and firms from hiring or investing.

A restaurant offering take away food remains open during curfew in Fitzroy suburb in Melbourne on Aug. 3.

Photographer: Carla Gottgens/Bloomberg

The gauge of weekly household sentiment plunged as Australia locked down, and rebounded in a V-shape as restrictions were lifted in May and the economy reopened earlier-than-expected. Confidence has since pulled back as outbreaks escalated, suggesting a nervousness across the nation that the viruss re-emergence could threaten households and firms, which only recently returned to work or reopened their doors.

Staying Put

% of people moving around the city, compared to usual levels

Source: Bloomberg, Citymapper

CityMapper, a public transit and mapping app that tracks userss movements shows mobility in major metropolises across the world. It has Melbourne fourth lowest on its global list with activity at just 12% of typical pre-Covid levels.

Sydney has seen activity return to only around one-third of its pre-virus level. Hot spots in the city, along with Victorias deterioration, have stifled recovery.

Traffic Tanks

Changes in driving rates since January

Source: Bloomberg, Apple

NOTE: shows 7-day moving average

With people still nervous about potential infection on public transport, car usage has picked since the first lockdowns were lifted. In Sydney, people are actually driving more than they did pre-Covid, according to according to Apple Inc.s Mobility Trends Report, which reflects usage of its Maps app.

Melbourne traffic remains well below its typical level and its new 8 p.m. to 5 a.m. curfew and the 5 kilometer restriction on travel from home should cause further declines.

Vehicles are parked along an empty street in Fitzroy suburb during curfew in Melbourne on Aug. 3.

Photographer: Carla Gottgens/Bloomberg

Empty Chairs

Fewer seated diners at restaurants in OpenTable network

Source: Bloomberg, OpenTable

Unsurprisingly, restaurant bookings have gone deep south, collapsing in Melbourne, which had been in lockdown for three weeks already before restrictions this week were further tightened and the nighttime curfew was introduced.

Sydney also shows signs of mounting fear, particularly as the community spread of Covid-19 has been traced to restaurants and dining venues. Sydneysiders, in turn, are choosing to again stay home.

A notice of closure is displayed in the window of a restaurant at Bondi Beach in Sydney on March 24.

Photographer: Brendon Thorne/Bloomberg

Debt Be Gone

Households continue to focus on paying down debt

Source: Reserve Bank of Australia

Government stimulus payments to households and firms, combined with fewer options for spending amid shutdowns, have swelled Australians‘ bank accounts. Credit card balances are tumbling in response, accelerating a trend that was already underway. This is no bad thing in a country with one of the developed world’s highest levels of household debt.

Australia Stimulus Lands at Households, Ready to Carry Recovery