We need no reminder of the headline news, just look at the pop in the “fear index” aka S&P 500 VIX to understand a change in the narrative, and definitely the mood may be underway.
IMF Revised Forecasts
More than 75% of the global economy is stepping into phase one reopening and several countries are experiencing a new second wave.
Without a vaccine anytime soon,
“the strength of the recovery is highly uncertain”
“We are now projecting a deeper recession in 2020 and a slower recovery in 2021.”
$12 trillion over 2 years
(2018 US economy was about $20 trillion)
Crisis & Recovery
“This crisis like no other will have a recovery like no other.”
Better news on vaccines and treatments
- “Further waves of infections can reverse increased mobility and spending, and rapidly tighten financial conditions, triggering debt distress.”
- “Geopolitical and trade tensions could damage fragile global relationships at a time when trade is projected to collapse by around 12 percent.”
Debt is an issue and challenge again
“Public debt is projected to reach this year the highest level in recorded history in relation to GDP, in both advanced and emerging market and developing economies. Countries will need sound fiscal frameworks for medium-term consolidation, through cutting back on wasteful spending, widening the tax base, minimizing tax avoidance, and greater progressivity in taxation in some countries.”
“At the same time, this crisis also presents an opportunity to accelerate the shift to a more productive, sustainable, and equitable growth through investment in new green and digital technologies and wider social safety nets.
Global cooperation is ever so important to deal with a truly global crisis. All efforts should be made to resolve trade and technology tensions while improving the multilateral rules-based trading system. The IMF will continue to do all it can to ensure adequate international liquidity, provide emergency financing, support the G20 debt service suspension initiative, and provide advice and support to countries during this unprecedented crisis.”