The COVID-19 pandemic has brought about a severe and unprecedented global economic shock. However, we believe that the economic rebound in developed markets will be robust as public health data start to improve and social distancing measures are lifted. In particular, the US, Europe and Japan have implemented swift and decisive policy action to alleviate the economic damage arising from the pandemic.
Emerging markets will likely experience a much greater public health and economic impact and many countries will require lending assistance on the road to recovery.
We forecast that the COVID-19 pandemic will reduce global GDP growth significantly in 2020 to levels associated with a global recession and the third-worst performance in about half a century, even if it remains above growth performance in 2009. However, we expect to return to a healthy, normalised growth rate by the end of 2021.