The UK economy will be hit hard by COVID-19. Economists at TD Securities take a look at the British economy outlook.
Key quotes
“We look for GDP to decline nearly 20% by 2020Q2, and for the recovery to be relatively sluggish. By end-2020, the economy is likely to be 6% smaller than it was in 19Q4, and by end-2021, still 3% smaller.”
“The deficit is likely to balloon to nearly 10% of GDP this year. We see it recovering only slightly next year and in 2022.”
“We expect the Bank of England to purchase £300bn of gilts by year-end, with another £50bn in early 2021 before concluding the programme. We do not expect further cuts to Bank Rate.”
“The UK is now likely to be even closer to leaving the transition period at the end of the year without a broad deal. This uncertainty continues to leave us biased to be short GBP both against the USD and EUR.”
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