Texas rows back on reopening; cash is king as business mulls future rebound


The Atlantic Council’s Coronavirus Alert is a regular summary of policy, economic, and business events around the emergency. To stay updated, sign up to the Coronavirus Alert here.

In top stories today:

  • Younger people make up a bigger proportion on coronavirus sufferers in the United States, where Texas rowed back on reopening the state as cases increased. Cash is king as companies prepare for what might come next for the economy, while bank payouts came into focus by regulators.
  • Cases of coronavirus in India approached half a million following another record day of increases, while Indonesia, Pakistan, and Mexico also contend with large outbreaks and healthcare systems under stress, The Associated Press reported. South Africa reported a record number of new cases of the virus too, the news service added.
  • Younger people are comprising a larger proportion of coronavirus cases in US cities and states where infections are surging, a cause of alarm to public health officials, The New York Times reported, citing examples from Arizona, Florida, and Texas. That has led to renewed calls for social distancing and masks, the newspaper added.
  • Texas governor Greg Abbott halted plans to ease restrictions and banned elective surgery in the state’s four biggest cities following a spike in coronavirus cases, the Financial Times reported. That’s the clearest sign yet that states in the south and west may have to change course only a month after giving businesses the go-ahead to reopen, the newspaper said.
  • The World Health Organization (WHO) said eleven countries in Europe face dangerous increases in coronavirus cases, France 24 reported, citing WHO regional director Hans Kluge. These countries are Albania, Armenia, Azerbaijan, Bosnia-Herzegovina, Kazakhstan, Kosovo, Kyrgyzstan, Moldova, North Macedonia, Sweden, and Ukraine, euronews reported.
  • The African Union urged governments worldwide to lift all obstacles to a speedy and equitable distribution of any successful coronavirus vaccine, including intellectual property rights, The Associated Press said. The grouping’s statement, read out after a regional conference on the search for a coronavirus shot, cites the Doha Declaration on public health by World Trade Organization members in 2001, which refers to the right to grant compulsory licenses, the news service added.


  • The world may be past the worst of the coronavirus epidemic but a return to the pre-pandemic status quo is unlikely, Christine Lagarde, the president of the European Central Bank, said on June 26, CNBC reported. Trade will probably be “significantly reduced” in a world where proximity might hold sway, said Lagarde, who was speaking during the online Northern Light Summit, CNBC added.
  • QUOTE: “We probably have passed the lowest point and I say that with some trepidation because of course there could be a second wave,” said Lagarde, CNBC reported. “We need to be extremely attentive to those that are most vulnerable.”
  • As many as 2.4 million children in war-torn Yemen may be pushed to the edge of starvation by the end of the year as coronavirus sweeps across the country and there’s a “huge” decline in humanitarian funding, the UN children’s agency UNICEF said on June 26, The Associated Press reported. That would be a 20 percent increase on current levels, UNICEF said, the news service added.
  • “Lessons From the Pandemic Add Urgency to ECB’s Focus on Climate” reads a Bloomberg headline. The impact of coronavirus has spurred on central bankers to go further with their efforts to fight climate change, with a flurry of initiatives from London to Amsterdam and Frankfurt, the newswire reported.  


  • Two days of temperatures exceeding thirty degrees centigrade in the United Kingdom led to a series of large gatherings and violent incidents, prompting concern about coronavirus spreading because of a lack of social distancing, the BBC reported. A major incident was declared after thousands flocked to Bournemouth on England’s south coast, causing traffic gridlock and local police reports of fights and overnight camping, the broadcaster said in a separate report.
  • QUOTE: “There’s a huge sense of pent-up frustration among so many people who feel that they’ve been confined,” David Nabarro, the WHO’s special envoy on coronavirus, told the BBC. “The only question that I’ve got is whether or not the British public are sufficiently aware of just how constant the danger is.”
  • London police plan to crack down on illegal gatherings that flout coronavirus rules after officers came under attack for a second night in a row after trying to disperse revelers, Reuters reported. Police have had to cope with a wave of illegal raves and parties across the United Kingdom as lockdown restrictions are eased, the newswire added. Illegal raves are a phenomenon across Europe too, Reuters said in a separate article.


  • The Federal Reserve put a temporary restriction on payouts to shareholders by the country’s biggest lenders and barred share buybacks to ensure that banks are still able to keep lending during the coronavirus downturn, The New York Times reported. Denmark’s financial watchdog has urged banks to withhold investor rewards until 2021 at least, in step with European Union guidelines, Bloomberg said.  
  • European companies’ appetite for cash means a strong recovery is around the corner? Not so fast, said ING economist Peter Vanden Houte, Bloomberg reported. June 26 data showed the biggest growth of money supply in the euro area for more than a decade, which in good times would point to business investment and consumer spending; but not this time, the newswire said.
  • QUOTE: “It would be wrong to see in the current figures a sign of economic strength,” Vanden Houte wrote in a report, Bloomberg said. “On the contrary, because of the Covid-19 pandemic, firms have drawn on their committed credit lines to avoid any liquidity shortages in the coming months.”
  • READ MORE: “The COVID-19 pandemic has since only elevated the debate about Europe’s digital sovereignty,” write the Atlantic Council’s Frances Burwell and Kenneth Propp. “Combined with geopolitical concerns, including growing sensitivity about China’s rapidly increasing role in the European economy, the pandemic is prompting a review of Europe’s strategic position and appears to be strengthening a belief that Europe should seek greater ‘strategic autonomy.'”
  • Sneaker-maker Nike posted an unexpected loss in its fiscal fourth quarter as temporary store closures during lockdowns hurt sales, CNBC reported. Online sales surged by 75 percent but costs for shipping and returns added to pressure on the Portland, Oregon-based company, CNBC added. Closures during the pandemic also hurt H&M, the world’s second-biggest fashion retailer, which posted a slightly bigger fiscal second-quarter loss than expected, CNBC said in a separate article.
  • QUOTE: “There are very tragic projections for what might happen to employment, there’s enormous dislocation in the labor market,” UK Chancellor of the Exchequer Rishi Sunak told Bloomberg TV in an interview on June 26, the newswire reported. “My priority absolutely is to try and protect and preserve as many of those jobs as possible.”
  • Sunak will gauge the public response to the so-called “independence day” reopening of the hospitality industry on July 4 before deciding whether to introduce measures such as a cut to value added tax to spur consumer spending, the Financial Times reported. The chancellor’s fiscal statement, scheduled for July 9, may be delayed by a week, the newspaper added.


  • Spain agreed to extend emergency paid-leave programs by three months until the end of September, the Financial Times reported. That covers two million people who hope to go back to their jobs as the coronavirus crisis lets up, but are far from certain that they will do so, the newspaper added. Labor unions and businesses say the extension is vital to avoid largescale destruction of jobs and company collapse, the Financial Times said.
  • Italy sent soldiers to restore order in the coastal town of Mondragone, forty-five kilometers from Naples, after an outbreak of coronavirus in an apartment complex where hundreds of migrant workers live illegally led to angry clashes with local residents, Reuters reported. More than forty people in the block tested positive, and the whole town could be quarantined if the outbreak proves to be widespread, Reuters added.
  • Doctors and health officials in South America are ramping up inoculation against seasonal flu as the winter sets in so as to avoid extra strain on hospitals already under pressure by the coronavirus outbreak, Reuters reported.
  • EVENT: Under the strain of economic sanctions, an embargo on the export of oil, and the impact of COVID-19, the Islamic Republic faces some of its biggest economic challenges in decades. Please join the Atlantic Council’s Future of Iran Initiative for a timely discussion on Iran’s economy on June 26, 2020 from 9:30 am to 10:30 am ET. Further details are here.