Global | The economy is at the mercy of the pandemic

The pandemic has been the deciding factor in the performance of the global economy throughout the year, and will certainly remain so in the coming quarters.

Key points

• Key points:
• Following the sharp fall in the second quarter, the recovery seen in the third quarter has been better than expected but still not enough to restore pre-pandemic levels.
• Signs of slowdown began to appear in August — in Europe linked to the gradual onset of the second wave, and in the United States linked to the stabilization of the first wave followed by the new spike.
• The service sector has been more affected than the manufacturing sector — hitting close to home in Spain, which depends heavily on tourism, and this impact has become more visible at global level with the second wave.
• Looking more to the medium term, the key factor in restoring consumption patterns to something than can be loosely described as normal will be the widespread distribution of vaccines, which we expect to see by mid-2021.
• As such, the developed countries face a difficult few months to come but will start to see the light at the end of the tunnel early in the new year, when they will drag the emerging markets along with them. This could allow the global economy to grow by 5.4% in 2021 following the fall of 2.9% this year.

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