A deep global recession in 2020 is now the baseline forecast and the economic activity is expected to decline by 1.9% in 2020, Fitch Ratings said on Thursday, per Reuters.
Key takeaways
“China’s recovery from the disruption in Q1 2020 will be sharply curtailed by the global recession.”
“The speed with which coronavirus is evolving has necessitated another round of huge cuts to our GDP forecasts.”
“The US, eurozone and UK GDP is expected to decline by 3.3%, 4.2% and 3.9%, respectively.”
“Lockdowns could reduce GDP across the EU and the US by 7% to 8%, or 28% to 30% annualised, in 2Q20.”
“Baseline forecast does not see GDP reverting to its pre-virus levels until late 2021 in the EU and Europe.”
Market reaction
These remarks don’t seem to be having a significant impact on the market sentiment. As of writing, major European equity indexes were up between 0.45% and 0.7%.
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