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The IMF says its forecast for the COVID-19 recession might now be too optimistic

Author:  Ben Winck

Affiliation: Markets Insider Junior Reporter, Business Insider

Organization/Publisher: World Economic Forum

Date/Place: April 18, 2020/ Switzerland

Type of Literature: Report

Word Count: 1200

Link:https://www.weforum.org/agenda/2020/04/imf-economy-coronavirus-covid-19-recession/

Keywords: IMF, World Economic Forum, Recession, Great Lockdown 

Brief:

International Monetary Fund issued a report titled “Great Lockdown” which narrates that the global economy will shrink by 3% GDP per capita, which stirred up many nations. However, a report published by World Economic Forum says that the IMF’s forecast for the Covid-19 recession might now be “too optimistic.” IMF’s report lists 170 nations with fragile economies, that most would likely be shattered by economic recession. The report further highlights that the post Covid-19 recession will keep economies in struggle for years to come. The following graph reflects the trembling Purchasing Power Parity as a result of Covid-19 great lockdown. 

A close up of a map Description automatically generated

 The still “unknowns” of the virus’ future have left the world’s connoisseurs in the obscure, but the IMF’s latest report lays out bleak effects for protracted outbreaks. Should the epidemic last through 2020, the world economy will appear with extremely modest improvements the following year in a slow-moving reverberation. But a 2021 resurgence of the virus “would yield an even worse downturn,” and GDP would sharply contract “as credit health deteriorates.”

By: Maryam Khan, CIGA Research Associate

 

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