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The Economist Intelligence Unit expects global output to contract by 2.5% this year—an even deeper contraction than during the global financial crisis. A rise in uncertainty will lead to increased precautionary savings among households and delayed business investment. The report says, some consumers may also continue to self-quarantine after governments lift lockdowns for fear of contracting the coronavirus, which will constrict the recovery in private consumption. EIU has forecasted, expect
growth to rebound to 9.2% quarter on quarter in April-June. However, this will mainly be due to base effects, and we believe that China’s full-year growth will be a mere 1%. Across Europe, the containment measures adopted to slow the spread of coronavirus will lead all economies to contract in 2020. With respect to the US, factoring in the abrupt implementation of measures needed to contain the virus, the steep jump in jobless claims in late March and sluggish progress in accelerating testing for coronavirus, and expect real GDP to contract by 2.9% in 2020.