The IMF now says global activity is expected to fall -4.9 percent in 2020, 1.9 percentage points below their April 2020 forecast. They say the pandemic has had a more negative impact on activity in the first half of 2020 than they anticipated, and the recovery is now projected to be more gradual than previously forecast. If the expected rebound happens this will leave 2021 GDP some 6½ percentage points lower than in the level they were expecting at the start of 2020. The adverse impact on low-income households is particularly acute they say, and will probably add more to extreme poverty than at any time since the 1990s.
The IMF report is tough reading. It sees the US -8% lower at the end of 2020 than 2019, and the EU -10% lower. Japan will be -5.8% lower while China will be +1% higher and among the large economies, the clear ‘winner’. India will be -4.5% lower. Australia is seen shrinking -4.5% (and that is less than their April forecast) but New Zealand doesn’t get a mention in this update.
The full IMF report which was released about five hours ago can be found here:
https://www.imf.org/en/Publications/WEO/Issues/2020/06/24/WEOUpdateJune2020
Note in the table that China is predicted to be the ONLY economy to gain in 2020 and that in 2021, the prediction is that China will be the strongest economy.
Ubudian Roy
Article URL : https://www.interest.co.nz/news/105677/imf-issues-grim-2020-forecasts-wall-street-retreats-china-only-growing-economy-has-its