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Global GDP will contract by 4.4% in 2020, follows from the updated macro forecast by Fitch: it is improved compared to the previous June estimate (minus 4.6%). "The pace of economic recovery after the record recession in March and April turned out to be higher than expected, although they will slow down in the near future," the agency notes. Nevertheless, in 2021, Fitch analysts now expect global growth of 5.2%, that is, the coronavirus downturn will be offset by the global economy by the end of next year. However, the previous level of GDP will not be reached in the United States until the end of next year, in the euro area - until the end of 2022 (and this is provided there are no new nationwide quarantines).
In the positive direction, the forecast for the United States was adjusted the most, from minus 5.6% to minus 4.6% (4% growth is expected in 2021), and for China, where the estimate was improved from 1.2% to 2 , 7% (next year growth is expected to accelerate to 7.7%), according to the results of the second quarter, the growth of the PRC's economy in annual terms has already amounted to 3.2%.
For the euro area, the estimate was reduced from minus 8% to minus 9% (the decline in the second quarter turned out to be stronger - minus 12.1%), in the UK - from minus 9% to minus 11.5% (an increase of 5.5% in 2021). Consumption in France and the UK is now above February levels, but Europe faces the impact of rising unemployment rates (as employment support programs end), companies are cutting capex, and transport and tourism, which in the US and Europe account for 8-10% of GDP, remain in deep depression.
At the same time, the forecast provides that the EU and the UK will switch to trade terms within the WTO early next year (instead of full-fledged duty-free trade).
For all developing countries, excluding China, the forecast is also worsened: from minus 4.7% to minus 5.7% (this is primarily due to the sharp decrease in the forecast for India from minus 5% to minus 10.5%). According to the results of the second quarter, the global GDP sank by 8.9%, and in many countries - by more than 20% (including India, Great Britain and Spain). In general, in the first half of 2020, the decline was 10%, according to Fitch.
source: fitchrating.com
In the positive direction, the forecast for the United States was adjusted the most, from minus 5.6% to minus 4.6% (4% growth is expected in 2021), and for China, where the estimate was improved from 1.2% to 2 , 7% (next year growth is expected to accelerate to 7.7%), according to the results of the second quarter, the growth of the PRC's economy in annual terms has already amounted to 3.2%.
For the euro area, the estimate was reduced from minus 8% to minus 9% (the decline in the second quarter turned out to be stronger - minus 12.1%), in the UK - from minus 9% to minus 11.5% (an increase of 5.5% in 2021). Consumption in France and the UK is now above February levels, but Europe faces the impact of rising unemployment rates (as employment support programs end), companies are cutting capex, and transport and tourism, which in the US and Europe account for 8-10% of GDP, remain in deep depression.
At the same time, the forecast provides that the EU and the UK will switch to trade terms within the WTO early next year (instead of full-fledged duty-free trade).
For all developing countries, excluding China, the forecast is also worsened: from minus 4.7% to minus 5.7% (this is primarily due to the sharp decrease in the forecast for India from minus 5% to minus 10.5%). According to the results of the second quarter, the global GDP sank by 8.9%, and in many countries - by more than 20% (including India, Great Britain and Spain). In general, in the first half of 2020, the decline was 10%, according to Fitch.
source: fitchrating.com
