Why Food Prices Are Rising In The U.S.

<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="740" height="416" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106928093-1629121893682-gettyimages-1334142759-cg6a1626_2021081412940649.jpeg" alt="" class="wp-image-412006" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106928093-1629121893682-gettyimages-1334142759-cg6a1626_2021081412940649.jpeg 740w, https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106928093-1629121893682-gettyimages-1334142759-cg6a1626_2021081412940649-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106928093-1629121893682-gettyimages-1334142759-cg6a1626_2021081412940649-160x90.jpeg 160w" sizes="auto, (max-width: 740px) 100vw, 740px" /><figcaption>Kyndal Bolden, 15, holds the hand of her aunt as she receives a COVID-19 vaccination dose on August 14, 2021 in New Orleans, Louisiana. Mario Tama | Getty Images</figcaption></figure>



LONDON — Looking at the Covid case data in the U.S., U.K. and the rest of Europe, you’d be forgiven for thinking that, despite 18 months of a global health crisis and advanced vaccination rollouts, we’re in just as bad a situation as we ever were.



Certainly the number of Covid cases being recorded daily in the West remains high, and even resembles earlier peaks at different points, or Covid waves, during the pandemic.



The current 7-day moving average of daily new cases stands at 153,246, an increase of 4.9% compared with the previous 7-day moving average (of 146,087). The current 7-day moving average is 123.6% higher than the value observed around a year ago, according to data compiled by the Centers for Disease Control and Prevention (CDC). In total, more than 40 million Covid cases have been counted in the U.S. since the pandemic began.



Case rates in the U.K. also remain high. As of Sept 6., the seven-day average of daily new cases was almost 39,000 and the number of daily cases has remained high as the week has progressed; almost 40,000 new cases were reported on Wednesday, and around 38,000 cases were recorded on Thursday, government data showed.



In the EU + EEA area (a total of 30 countries), in the seven days up to Sept. 5, 405,774 new cases were recorded, according to the European Centre for Disease Prevention and Control, with Ireland, France, Sweden, Portugal, Greece and Bulgaria among the countries reporting the highest numbers of new cases per 100,000 population.



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The high numbers of cases remains attributable to the spread of the highly infectious delta variant, which usurped previous variants that themselves were more infectious than the original strain of Covid-19.



Nonetheless, the rise in cases has accompanied the advancement of vaccination programs in the West with the majority of adults in both the U.S. and Europe now fully vaccinated.



In the U.S., 62.4% of all people over 12 years of age are fully vaccinated, CDC data shows, while over 82% of over-65s are fully protected. In the U.K., 80.4% of the population over the age of 16 are fully vaccinated and in the EU/EEA, 70.4% of adults have received two doses of a coronavirus vaccine, ECDC data shows.



Crucially, the number of hospitalizations and deaths accompanying the high number of cases has remained lower (and for some countries, much lower) than at earlier points in the pandemic when vaccination rates were much lower, proving that the coronavirus vaccines in use in the West dramatically lower the chance of a severe infection, hospitalization and death. Hospitalizations in the U.S. remain high, data from Our World in Data show.



Yet none of the vaccines in use in the U.S. or Europe is 100% effective, meaning that some vaccinated people will get Covid (so-called “breakthrough cases”) and a small number of those will get sick. The predominant delta variant has also lowered the efficacy of the vaccines on offer and some new studies show the immunity provided by shots wanes over time.



<h2 class="wp-block-heading" id="h-why-are-cases-high"><a></a>Why are cases high?</h2>



CNBC asked epidemiologists based in Britain why cases remain so high given the relatively high vaccination rates in the West.



“The delta variant is highly contagious and this accounts for the continuing high number of cases now that we are mixing much more freely since most restrictions were eased,” Andrew Freedman, a reader in infectious disease at Cardiff University School of Medicine, told CNBC Thursday.



“Those catching Covid now are a mixture of unvaccinated, partially vaccinated and double vaccinated people.&nbsp;A large proportion of new infection are in (unvaccinated) children and adolescents,” he noted.



“We know that the vaccines are only partially effective at preventing people from catching the delta variant, but are much more effective at protecting against severe disease, hospitalisation and death.&nbsp; Fully vaccinated individuals are mostly getting only mild symptoms if they do catch it, although a small minority, especially older and more frail people, are still getting more severe illness.”



In the U.K., the latest data from the ZOE Covid study, which tracks Covid symptoms and infections in the community using the data from around a million people every week, estimates that in the fully vaccinated population, there are currently 17,674 new daily symptomatic cases in the U.K.



It noted, in its latest research published on Thursday, that “cases in this group had been rising steadily but have now stabilised, with last week’s figure being 17,342.”



Meanwhile, new Covid cases are the highest among those aged 0-18 and 18-35 year olds, many of whom are only partially vaccinated (two doses of a Covid shot are vital to achieve maximum protection), or unvaccinated.



Similar data pertains to the U.S. and the rest of Europe over the last month: CDC data shows that the highest number of cases has been counted among adolescents aged 16-17 (though age groups from 12-49 have all seen a sharp increase in cases). In the EU/EEA the highest number of cases is among the 25-49 year old age bracket closely followed by the 15-24s and a rising number of cases among children, age 5-14.



Epidemiologists and public health experts have long-expressed the view that Covid-19 is just something we’re going to have to get used to, that the virus will become endemic and cannot now be eradicated.



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Pursuing a so-called “zero Covid” strategy (aiming to eliminate all Covid cases) has been seen as a hopeless cause by most countries, although Australia and New Zealand have pursued such a strategy. Australia announced at the end of August that it was abandoning such a policy, however, given the spread of the highly infectious delta variant. New Zealand is maintaining its strategy, for now.



Danny Altmann, professor of immunology at Imperial College London, explained to CNBC that societies need to assess to what extent they will tolerate the virus.



“We’ve always said, and still maintain, that the vaccines are amazing and give enormous levels of protective neutralising antibodies,” he told CNBC Thursday. Even if clinical studies show that the delta variant reduces the efficacy of vaccines, Altmann noted “there’s so much protective headroom that ‘most’ people should be safe.”



“In a sense that’s how we’ve seen it play out — with the delta variant and without vaccination we’d now be at several thousand deaths per day, but we’re at ‘only’ a few hundred, so there’s tangible mitigation of severe disease,” he said.



“However, our protection seems less robust against delta than we’d predicted when you consider that in the U.K. there are around 40,000 cases per day including many of these breakthroughs &#8230; [and] people becoming significantly unwell though not hospitalised,” he said, noting that data from Israel on giving booster shots showed that additional jabs could re-boost antibody levels and combat breakthrough cases.



A lot of the debate around Covid currently, Altmann said, “comes back to that policy/philosophy debate about what we’re now trying to achieve.”



“The extremes of the argument are, either that, at least until we see what happens in autumn/winter, we’ve achieved our goal as relatively high vaccine rollout has meant that hospitals can just about cope &#8230; Or, the other view is that we’ll never have normality unless we strive for a zero-Covid strategy, which would need to encompass vaccination in our schools to stop spread there,” he noted.



Those calling for a zero-Covid strategy encompassed people who believed that “we’re sitting ducks in perpetuity for ever more cases, until we allow through a much more resistant variant to really scupper us,” Altmann said.

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<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="740" height="416" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106553902-15905961992020-05-03t000000z_392955759_rc24hg9p1seb_rtrmadp_0_health-coronavirus-who-ryan.jpeg" alt="" class="wp-image-411927" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106553902-15905961992020-05-03t000000z_392955759_rc24hg9p1seb_rtrmadp_0_health-coronavirus-who-ryan.jpeg 740w, https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106553902-15905961992020-05-03t000000z_392955759_rc24hg9p1seb_rtrmadp_0_health-coronavirus-who-ryan-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106553902-15905961992020-05-03t000000z_392955759_rc24hg9p1seb_rtrmadp_0_health-coronavirus-who-ryan-160x90.jpeg 160w" sizes="auto, (max-width: 740px) 100vw, 740px" /><figcaption>Executive Director of the World Health Organization’s (WHO) emergencies program Mike Ryan speaks at a news conference on the novel coronavirus (2019-nCoV) in Geneva, Switzerland. Denis Balibouse | Reuters</figcaption></figure>



Covid-19 is likely “here to stay with us” as the virus continues to mutate in unvaccinated countries across the world and previous hopes of eradicating it diminish, global health officials said Tuesday.



“I think this virus is here to stay with us and it will evolve like influenza pandemic viruses, it will evolve to become one of the other viruses that affects us,” Dr. Mike Ryan, executive director of the World Health Organization’s Health Emergencies Program, said at a press briefing.



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Officials at the global health agency have previously said vaccines do not guarantee the world would eradicate Covid-19 like it has other viruses. Several leading health experts, including White House chief medical advisor Dr. Anthony Fauci and Stephane Bancel, CEO of Covid vaccine maker Moderna, have warned that the world will have to live with Covid forever, much like influenza.



“People have said we’re going to eliminate or eradicate the virus,” Ryan said. “No we’re not, very, very unlikely.”



If the world had taken early steps to stop the spread of the virus, the situation today could have been very different, WHO officials said.



“We had a chance in the beginning of this pandemic,” Maria Van Kerkhove, the WHO’s technical lead on Covid-19, said Tuesday. “This pandemic did not need to be this bad.”

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<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="740" height="416" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/106914167-1626861873395-gettyimages-1234061399-sindeyev-notitle210719_npeAJ.jpeg" alt="" class="wp-image-410239" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/07/106914167-1626861873395-gettyimages-1234061399-sindeyev-notitle210719_npeAJ.jpeg 740w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/106914167-1626861873395-gettyimages-1234061399-sindeyev-notitle210719_npeAJ-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/07/106914167-1626861873395-gettyimages-1234061399-sindeyev-notitle210719_npeAJ-140x80.jpeg 140w" sizes="auto, (max-width: 740px) 100vw, 740px" /><figcaption>A bitcoin sign with a graph pictured in the background.
STR | NurPhoto via Getty Images</figcaption></figure>



The price of bitcoin fell Tuesday after breaking through $52,000 late Monday, reaching its highest level since May.



The price action comes on the day <a href="https://www.cnbcafrica.com/2021/el-salvador-bought-21-million-of-bitcoin-as-it-becomes-first-country-to-make-it-a-legal-currency/">El Salvador is set to adopt the largest cryptocurrency by market cap as legal tender,</a> becoming the first country to do so. Bitcoin dropped as much as 16% on Tuesday morning. It was last down about 9.5% and trading at $46,892.04, according to Coin Metrics. Ether fell 12% to $3,441.21.



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<h3 class="wp-block-heading" id="h-bitcoin-becomes-legal-tender-in-el-salvador">Bitcoin becomes legal tender in El Salvador</h3>


</div></div>



Crypto adjacent stocks&nbsp;MicroStrategy&nbsp;and&nbsp;Coinbase&nbsp;also lost about 9% and 4%, respectively. Coinbase users were experiencing delayed or canceled transactions at “elevated rates” in the morning, the company&nbsp;said in an update&nbsp;on Twitter, but those issues were resolved by the afternoon. Major crypto exchanges Kraken and Gemini were also investigating delays and performance issues.



Early Tuesday El Salvador temporarily disabled Chivo, its government-run <a href="https://www.cnbcafrica.com/quotes/btc=x/">bitcoin</a> wallet, to increase the capacity of the servers, which were hindering new users from installing it, President Nayib Bukele announced in a tweet at about 7:00 a.m. EST.



“Any data they try to enter at this time will give them an error,”&nbsp;he said. “This is a relatively straightforward problem, but it cannot be fixed with the system connected.”



The market action is unsurprising, according to Leah Wald, CEO at Valkyrie&nbsp;Investments, who said the news was largely priced into the market “a while ago.”



“When this move was first announced, it didn’t have nearly as big of an impact on price as some may have expected it might, possibly because El Salvador’s population is less than New York City’s, but also because the announcement was light on details and people were on the fence about how this was going to be implemented,” she told CNBC, noting that much of El Salvador lives in poverty and doesn’t have the internet or smartphone access required to participate in the bitcoin network. “Transaction fees, processing times, and other hurdles also make this feel more like a beta test rather than a solution to many of the problems plaguing the country’s poor,” Wald added.



As part of the new law, businesses will be required to accept bitcoin for goods and services, though merchants who aren’t technologically able to accept bitcoin will be exempt. The government has installed 200 bitcoin ATMs around El Salvador. It also&nbsp;bought 400 bitcoins&nbsp;worth about $20 million and is preloading Chivo wallets with $30 worth of bitcoin for Salvadorans who register.



Some traders are saying on social media that they will be buying $30 worth of bitcoin in their local fiat currencies to commemorate and support El Salvador’s new law, at 3:00 p.m. ET. But bitcoin prices were sliding into the afternoon anyway.



“What is most worth looking out for is whether or not neighboring countries in Latin America, or those elsewhere around the world, begin to adopt bitcoin as their national currency as well,” Wald said. “Should this occur, that is when we could see a parabolic move higher, as the momentum gained from many millions more people having instant access to crypto should result in more adoption, more HODLing, and higher prices.” HODLing is crypto community slang for the buy-and-hold investment strategy.



Bitcoin advocates have long held there’s a strong case for Latin American markets using the cryptocurrency as a medium of exchange, for remittances and even for central banks that experience high currency depreciation.



On Monday Panamanian politician Gabriel Silva introduced the “Crypto Law,” which “seeks to make Panama a country compatible with the blockchain, crypto assets and the internet,” he said on Twitter. “This has the potential to create thousands of jobs, attract investment and make the government transparent,” he added.

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<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="740" height="416" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106937882-1630990784900-gettyimages-1234925807-EL_SALVADOR_BITCOIN.jpeg" alt="" class="wp-image-411901" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106937882-1630990784900-gettyimages-1234925807-EL_SALVADOR_BITCOIN.jpeg 740w, https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106937882-1630990784900-gettyimages-1234925807-EL_SALVADOR_BITCOIN-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106937882-1630990784900-gettyimages-1234925807-EL_SALVADOR_BITCOIN-160x90.jpeg 160w" sizes="auto, (max-width: 740px) 100vw, 740px" /><figcaption>A Chivo Bitcoin automated teller machine (ATM) at the Multiplaza Mall in San Salvador, El Salvador, on Saturday, Aug. 28, 2021. El Salvador began installing Bitcoin ATMs, allowing its citizens to convert the cryptocurrency into U.S. dollars and withdraw it in cash, as part of the governments plan to make the token legal tender. Camilo Freedman | Bloomberg | Getty Images</figcaption></figure>



El Salvador bought roughly $20.9 million worth of <a href="https://www.cnbcafrica.com/quotes/btc=x/">bitcoin</a>, one day before it formally adopts the world’s most popular cryptocurrency as legal tender. 



In a series of tweets Monday, President Nayib Bukele revealed that the country had purchased a total of 400 bitcoin, the first step in a larger push to add the digital currency to its balance sheet.



The tweets were posted a few hours apart. Based on the bitcoin price at the time of the tweets, the amount of the digital coin purchased totaled roughly $20.9 million.



“Our brokers will be buying a lot more as the deadline approaches,” he wrote.



The price of bitcoin rose following the tweets and was trading at around $52,681.85 at 12:16 a.m. ET Tuesday.



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The posts came hours before El Salvador’s bitcoin law, which was passed in June, took effect Tuesday. El Salvador is the first country to accept bitcoin as legal currency, which will work alongside the U.S. dollar. Proponents and critics around the world will be watching to see how this unprecedented experiment plays out.



Bukele’s announcement marks a major milestone for bitcoin. El Salvador is now the first country to have officially put bitcoin on its balance sheet and hold it in its reserves.



But the policy has drawn criticism across the country. Nearly 70% of Salvadorans surveyed by the Central American University disagreed with the administration’s decision to adopt bitcoin as legal tender. Many were also unsure of how to use the digital currency.



Supporters of El Salvador’s move say that it indicates growing acceptance of bitcoin and that other countries could follow. The Salvadorian government hopes it will boost financial inclusion in a country where around 70% of citizens do not have access to traditional financial services, according to the bitcoin law.



Remittances, or the money sent home by migrants, is also important for the economy, accounting for more than 24% of El Salvador’s gross domestic product, according to the World Bank.



The legislation allows prices to be displayed in bitcoin, tax contributions to be paid with the digital currency, and exchanges in bitcoin will not be subject to capital gains tax.



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El Salvador launched a wallet app called Chivo which citizens can sign up for with a national ID in order to transact using bitcoin. Users will receive $30 worth of bitcoin when they sign up in a push to speed up adoption.



Last Tuesday, the Congress in El Salvador passed a law to create a $150 million fund to help facilitate conversions from bitcoin to U.S. dollars.



But bitcoin is known for wild volatility at times, raising concerns about its effectiveness as a currency.



“Bitcoin isn’t really designed to be a means of exchange so this is an early experiment for the currency,” Philip Gradwell, chief economist at data platform Chainalysis, told CNBC’s “Capital Connection.”



“I think the main use in El Salvador is really going to be around remittances and people using it to save some wealth and really perhaps just to be some competition to the dollar in the country.”

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<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="740" height="416" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106923533-16282799082021-08-06t195149z_1213576152_rc2qzo9r8fny_rtrmadp_0_usa-economy.jpeg" alt="" class="wp-image-411850" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106923533-16282799082021-08-06t195149z_1213576152_rc2qzo9r8fny_rtrmadp_0_usa-economy.jpeg 740w, https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106923533-16282799082021-08-06t195149z_1213576152_rc2qzo9r8fny_rtrmadp_0_usa-economy-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106923533-16282799082021-08-06t195149z_1213576152_rc2qzo9r8fny_rtrmadp_0_usa-economy-160x90.jpeg 160w" sizes="auto, (max-width: 740px) 100vw, 740px" /><figcaption>A sign advertising job openings is seen while people walk into the store in New York City, New York, U.S., August 6, 2021. Eduardo Munoz | Reuters</figcaption></figure>



August’s employment report is expected to show another strong month for hiring, but it could also give a glimpse at how the Covid-19 delta variant has impacted the economy.



The jobs report, set for release Friday at 8:30 a.m. ET, is also expected to provide critical guidance for the Federal Reserve in its process of deciding when to begin trimming its bond purchases.



According to Dow Jones, economists expect 720,000 payrolls were added in August. That would be a strong number, but down from the 943,000 in July. The unemployment rate is expected to have slipped to 5.2% from 5.4%, and average hourly earnings are forecast to have risen by 0.3% or 4% on an annual basis.



“I think the risks are very much to the downside,” said Lee Ferridge,&nbsp;head of macro strategy for North America at State Street Global Markets. “I’m not sure how much we’re factoring in the impacts of delta.”



Forecasts for the report are wide-ranging, from about 300,000 to 1 million.



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“If you get a number that doesn’t meet expectations, say 500,000 instead of 735,000, to me that rules out a taper announcement in September, which is still consistent with the message [Fed Chairman Jerome] Powell gave in Jackson Hole,” Ferridge said.



A very weak number would raise concerns about the strength of the economy, he said.



“I think the market is pretty split on whether we get the announcement next month or in November. If we get a weak number, it pushes that announcement way back to November,” Ferridge said.



On the other hand, a strong jobs report could put a dent in stock prices Friday morning. “A very strong number, I think risk suffers because we think &#8211; okay, September taper,” Ferridge said. “That’s a tougher one for the market to shrug off. &#8230; We are in the weird world where bad news is good news in terms of risk appetite. Anything that says we might see a more hawkish central bank, that’s bad news.”



But just like economists, the Fed will also be looking at whether there are tell tale signs that Covid impacted hiring and activity. The virus variant has been a wild card for the economy, and its impact could be a factor that sways the Fed as it considers the first step away from the extraordinary easing policy it implemented to battle the pandemic.



Powell, speaking at the Fed’s Jackson Hole Symposium last week, said central bank officials agreed they should begin to taper their $120 billion-a-month bond buying program this year. The chairman said he would still like to see more progress in the labor market before a taper, so this employment report and the next have become extremely important input ahead of the Fed’s Sept. 22 meeting.



“I don’t think this is a deciding number for the Fed but it’s a glimpse of something we already know. That is that we already lost a lot of momentum,” Grant Thornton chief economist Diane Swonk said. “It looks like consumer spending is going to contract in the third quarter, and we knew the second quarter would be the crest in growth for the year.”



Swonk expects 675,000 jobs were added in August, including 100,000 in education as schools reopen. But she adds that there are risks the number could be lower than her estimate.



Goldman Sachs economists cut their forecast this week to 500,000 from 600,000 after Thursday’s report of manufacturing data showed a contraction in jobs in August. The Institute for Supply Management manufacturing index rose to 59.9, a surprise gain, but the jobs component slid 3.9 points to 49. A measure below 50 signals contraction.



Swonk said Hurricane Ida and other storms could impact the data in September. “We’ve got climate change colliding with Covid,” she said.



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Wilmington Trust chief economist Luke Tilley has among the lowest forecasts at 300,000. He said high-frequency data he watches indicates a slowing.



“We do think that the spread of delta and some slowing in spending has a lot to do with it,” he said. “Spending at restaurants is coming down. You can look at daily spending trackers. Spending on airlines and leisure came down from July.”



While some of that is normal over the course of the summer travel season, Tilley said there’s a bigger trend developing. “We do think we’re going to see a slowing. We’re in the process of revising some of our GDP numbers.”



But other economists are more optimistic about the progress in the labor market. Amherst Pierpont chief economist Stephen Stanley expects 950,000 jobs were added in August.



He called the Bureau of Labor Statistics employment report “one of the most consequential in years,” since several Fed officials have said they would push for a tapering announcement at the September meeting if the report is strong.



“I look for another robust report, which I expect to push the committee to announce a beginning of the taper process in September,” he wrote in a note.



Stanley added there has been anecdotal and survey data showing businesses are desperately trying to hire workers but continue to find a shortage.



“At the margin, the Delta wave my have led some fence sitters to remain on the sidelines a bit longer, but I doubt that it has made a major difference in the aggregate,” he wrote. The more important dynamic this summer has been the expiration of supplemental unemployment benefits.”



Stanley expects the trend to continue to be strong.



“Moreover, with school starting in most of the country by late August or early September and supplemental unemployment benefits expiring next week, I would look for job growth to pick up further over the next few months,” Stanley noted.

106923533-16282799082021-08-06t195149z_1213576152_rc2qzo9r8fny_rtrmadp_0_usa-economy

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<figure class="wp-block-image size-full is-resized"><img loading="lazy" decoding="async" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106913632-16267943792021-06-25t184217z_2101887965_rc2u7o9yru9z_rtrmadp_0_health-coronavirus-who.jpeg" alt="" class="wp-image-411829" width="838" height="471" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106913632-16267943792021-06-25t184217z_2101887965_rc2u7o9yru9z_rtrmadp_0_health-coronavirus-who.jpeg 740w, https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106913632-16267943792021-06-25t184217z_2101887965_rc2u7o9yru9z_rtrmadp_0_health-coronavirus-who-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106913632-16267943792021-06-25t184217z_2101887965_rc2u7o9yru9z_rtrmadp_0_health-coronavirus-who-160x90.jpeg 160w" sizes="auto, (max-width: 838px) 100vw, 838px" /><figcaption>World Health Organization (WHO) Director General Tedros Adhanom Ghebreyesus speaks during a bilateral meeting with Swiss Interior and Health Minister Alain Berset on the sidelines of the opening of the 74th World Health Assembly at the WHO headquarters, in Geneva, Switzerland May 24, 2021. Laurent Gillieron | Reuters</figcaption></figure>



The World Health Organization is monitoring a new coronavirus variant called “mu,” which the agency says has mutations that have the potential to evade immunity provided by a previous Covid-19 infection or vaccination.



Mu — also known by scientists as B.1.621 — was added to the WHO’s list of variants “of interest” on Aug. 30, the international health organization said in its weekly Covid epidemiological report published late Tuesday.



The variant contains genetic mutations that indicate natural immunity, current vaccines or monoclonal antibody treatments may not work as well against it as they do against the original ancestral virus, the WHO said. The mu strain needs further study to confirm whether it will prove to be more contagious, more deadly or more resistant to current vaccines and treatments.



<h3 class="wp-block-heading" id="h-read-more-raising-fears-of-covid-surge-uganda-detects-indian-variant-official-says">Read more: <a href="https://www.cnbcafrica.com/2021/raising-fears-of-covid-surge-uganda-detects-indian-variant-official-says/">Raising fears of COVID surge, Uganda detects Indian variant, official says</a></h3>



Mu “has a constellation of mutations that indicate potential properties of immune escape,” the WHO wrote in its report Tuesday.



“Preliminary data presented to the Virus Evolution Working Group show a reduction in neutralization capacity of convalescent and vaccine sera similar to that seen for the Beta variant, but this needs to be confirmed by further studies,” it added.



The agency is monitoring four variants “of concern,” including delta, which was first detected in India and is the most prevalent variant currently circulating in the U.S.; alpha, first detected in the U.K.; beta, first detected in South Africa, and gamma, first detected in Brazil. A variant of concern is generally defined as a mutated strain that’s either more contagious, more deadly or more resistant to current vaccines and treatments.



It’s also keeping a close watch on four other variants of interest — including lambda, first identified in Peru — that have caused outbreaks in multiple countries and have genetic changes that could make them more dangerous than other strains.



<h3 class="wp-block-heading">Read more: <a href="https://www.cnbcafrica.com/2021/south-africa-detects-new-coronavirus-variant-still-studying-its-mutations/">South Africa detects new coronavirus variant, still studying its mutations</a></h3>



Delta was a variant of interest until the WHO reclassified it in early May after preliminary studies found it could spread more easily than other versions of the virus. That variant has since been blamed for a number of large outbreaks around the world, including in the United States.



The new variant, mu, was first identified in Colombia but has since been confirmed in at least 39 countries, according to the WHO. Although the global prevalence of the variant among sequenced cases has declined and is currently below 0.1%, its prevalence in Colombia and Ecuador has consistently increased, the agency warned.



The WHO said more studies are required to understand the clinical characteristics of the new variant.



“The epidemiology of the Mu variant in South America, particularly with the co-circulation of the Delta variant, will be monitored for changes,” the agency said.

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<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="740" height="416" src="https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106931696-1629727676310-gettyimages-1234821819-AFP_9LH8GR.jpeg" alt="" class="wp-image-411803" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106931696-1629727676310-gettyimages-1234821819-AFP_9LH8GR.jpeg 740w, https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106931696-1629727676310-gettyimages-1234821819-AFP_9LH8GR-300x169.jpeg 300w, https://cms.cnbcafrica.com/wp-content/uploads/2021/09/106931696-1629727676310-gettyimages-1234821819-AFP_9LH8GR-160x90.jpeg 160w" sizes="auto, (max-width: 740px) 100vw, 740px" /><figcaption>Juan Rodriguez (L) reacts while receiving Johnson &amp; Johnson’s Janssen Covid-19 vaccine administered by vocational nurse Christina Garibay at a Skid Row community outreach event where Covid-19 vaccines and testing were offered in Los Angeles, California on August 22, 2021. Frederic J. Brown | AFP | Getty Images</figcaption></figure>



Covid-19 vaccines are still “stunningly effective” despite fears that immunity may dwindle over time, experts have said.



There have been some concerns about the efficacy of Covid-19 vaccines after a number of recent studies indicated&nbsp;a growing number of so-called “breakthrough” Covid cases among the fully vaccinated. The studies have, however, shown that the fully vaccinated are still highly protected against severe infection, hospitalization and death caused by the virus.



Preliminary data published by the Israeli government&nbsp;in July showed that the&nbsp;Pfizer vaccine was just 16% effective&nbsp;against symptomatic infection for people who had received two doses in January.&nbsp;For people who had been fully vaccinated by April, the vaccine was 79% effective against symptomatic infection, suggesting that immunity gained through immunization depletes over time.



A piece of research funded by Pfizer, published in July, showed that the efficacy of the Pfizer-BioNTech vaccine was strongest between one week and two months after receiving the second dose, coming in at 96.2%. It then, however, declined by an average of 6% every two months.&nbsp;Four to six months after a second dose, its effectiveness fell to around 84%.



In August, meanwhile, a U.K. study of more than one million fully vaccinated people found that protection from both the Oxford-AstraZeneca and the Pfizer-BioNTech vaccines faded over time.&nbsp;A month after receiving a second dose of the Pfizer vaccine, protection against the virus stood at 88%, the analysis showed. After five to six months, that protection fell to 74%.



Protection stood at 77% a month after being fully vaccinated with the Oxford-AstraZeneca vaccine, and fell to 67% after four to five months.



<h2 class="wp-block-heading" id="h-lessons-from-israel"><a></a>Lessons from Israel</h2>



Israel’s vaccination rollout was&nbsp;one of the fastest in the world. But despite this, the number of Covid-19 cases in Israel have been&nbsp;rising sharply since July.&nbsp;



In late July, Israel began offering everyone over the age of 60 a third vaccine dose.&nbsp;Its booster program has been rapidly expanded&nbsp;and third shots have been available to everyone over the age of 30 in the country since August.



Professor Eyal Leshem, an infectious disease specialist at Sheba Medical Center who has been treating Covid patients in Israel, told CNBC that while cases were rising despite a high vaccination rate, the rate of severe illness in the country remained “substantially lower.”



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“We attribute that to the fact that most of our adult population is vaccinated with two doses, and more than one million people have received the third booster dose,” he said on a phone call.



“The severe disease rates in the vaccinated are about one-tenth of those seen in the unvaccinated, which means the vaccine is still over 90% effective in preventing severe disease,” Leshem added. “People who received the booster dose are also at much, much lower risk of becoming infected, our short-term data shows.”



Richard Reithinger, an infectious disease expert and vice president of global health at U.S. based RTI International, told CNBC in an email that most of the developed vaccines for Covid-19 were “nothing short of stunningly effective, even with the newly emerging variants.”



“Irrefutable proof for that is how cases, severe disease requiring hospitalization and deaths dramatically dropped in countries that rapidly scaled-up vaccination coverage,” he said.



“In countries with very high vaccine coverage, such as Iceland with more than 90%, hardly any severe cases and deaths are being reported. Similarly, in countries with moderate to high vaccine coverage, like the U.S. and Canada, severe cases and deaths are almost exclusively seen in the unvaccinated.”



<h2 class="wp-block-heading"><a></a>Delta effect</h2>



An earlier English study, published in May, found that the Pfizer-BioNTech vaccine was 88% effective at preventing symptomatic disease from the delta variant. Against the alpha variant, once the dominant strain in the U.K., the vaccine was 93% effective at preventing symptomatic disease.



Meanwhile, the research found that two doses of the Oxford-AstraZeneca vaccine were 60% effective at preventing symptomatic disease from the delta variant, compared to a 66% efficacy rate against the alpha variant.



The data showed the importance of having two doses of these vaccines as the efficacy of both shots against symptomatic infection from the delta variant stood at just 33% three weeks after the first dose, the study found.



Reithinger told CNBC that if the virus continued to mutate, it did not necessarily mean it would become more resistant to existing vaccines however.



“The delta variant has been shown to be more transmissible than other variants, and vaccine effectiveness is slightly lower than for the alpha and beta variants. The kappa variant, which emerged in India around the same time, however, is not as transmissible,” he highlighted.



<h2 class="wp-block-heading"><a></a>Are booster shots the answer?</h2>



Several more countries, including the U.S. and the U.K., are now offering — or planning to offer — third doses of Covid-19 vaccines to help boost immunity to the virus that may have depleted.



According to Gideon Schreiber, a professor at Israel’s Weizmann Institute of Science, booster shots may become a necessity.



“Unfortunately, it’s not even [going to be] annually, it will be twice annually,” he predicted. “The virus has a huge potential for new variants, many which will work to silence immunity — so there’s a chance that we’ll need further boosters in the future.”



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Schreiber added that Israel’s booster program appeared, so far, to be a big success. After a second dose, he told CNBC, people were four or five times less likely to become severely ill with Covid. But after a third dose, they were more than ten times less likely to become severely ill with the virus.



However, Reithinger argued that booster shots were not necessarily a logical step at this point in time.



“There is only limited data available that an immune response that was primed by available vaccines is waning after six to eight months,” he told CNBC via email. “Most of the data is on infection, rather than hospitalization or death. The data also doesn’t account for the use of non-pharmaceutical interventions, such as masking and social distancing, that in many contexts should continue to be used and adhered to.&nbsp;The only population groups for which the case for booster shots can be made is the immunocompromised.”



However, he said that booster shots may eventually become necessary if data prove the vaccines’ efficacy against severe disease and death wanes over time.



<h2 class="wp-block-heading"><a></a>Hope for a treatment?</h2>



Schreiber is currently supervising research on a therapeutic drug that would act as a “super-cork,” physically jamming itself into cell receptors that the virus attaches itself to. By working to block cells’ “entry ports” rather than attacking the virus itself, scientists are hoping to stay on top of any future mutations.



“It should work against future variants, because it’s not really going after the virus — the virus can change, but as long as the virus binds to it, it’s going to block it,” he told CNBC.



However, Schreiber said the drug wouldn’t be something that could be used on a wide scale.



“It’s too expensive, and there’s no need,” he said. “The way I see it is that it would be given to people who got Covid and were in a high-risk group. It also doesn’t have a long-term effect like a vaccine.”



The Sheba Medical Center’s Leshem argued that vaccinations were currently the best hope society had of finding a state of “equilibrium” with the virus, where the virus could circulate without severe repercussions.



“The best hope for people at risk is immunization, an effective vaccine, which we currently have, and may be improved through boosters, through mixing or through other methods,” he said.



“Despite very [intense] research, it’s very challenging to find effective treatments — viruses are not bacteria. So while we’ve developed good antibiotics that have dramatically changed the course of bacterial infection, we do not have such good antivirals for many of the viruses that infect humans.”



Pharmaceutical companies are also looking at new treatments to prevent Covid aside from vaccines.&nbsp; In mid-August, AstraZeneca published results from a phase three trial of an antibody therapy which was found to reduce the risk of developing symptomatic Covid-19 by 77%. There were no deaths or cases of severe illness among the 25 participants who contracted symptomatic Covid during the trial.&nbsp; A total of 5,172 people took part in the trial, 75% of whom had co-morbidities.



Reuters reported&nbsp;that AstraZeneca was seeking conditional approval for the therapy in major markets this year. The pharmaceutical giant would produce 1 to 2 million doses by the end of this year, the news agency said.



“What I really believe is that we really need a medicine,” Schreiber told CNBC. “There are many efforts in developing drugs, there is no reason not to believe it will not come in the near future. It will come and this basically, I think, will end the story.”



He added:“The virus keeps mutating — new variants will come, but the speed of technological advances is really amazing. So I say there’s no reason to despair.”

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