Global | The economy is shaped by the pandemic

Summary

The global economic scenario is defined by COVID-19, with a recession comparable to the Depression 90 years ago. It is also shaped by uncertainties including, the trajectory of the contagion curve and the achievement of herd immunity, for which having an effective and accessible vaccine will be a determining factor.

Key points

• Key points:
• At BBVA Research, we have lowered from -2.4% to -3.1% the expected GDP growth in 2020 given the greater drops in activity in the first quarter.
• The bottom of the GDP’s “V” will be located in the second quarter.
• The improvement of the economy since then will be uneven and incomplete: none of the major areas will achieve near to pre-crisis expectations for the GDP level by the end of 2021.
• The economic ramifications of COVID-19 will be more persistent where there have been more severe and prolonged lockdowns and where there is greater specialization in sectors that, like tourism and leisure, will be further harmed by the fear of contagion.

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