InvestorQ : Do you expect the COVID-19 to have a big impact on global GDP and what is the extent of impact that you foresee?
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Do you expect the COVID-19 to have a big impact on global GDP and what is the extent of impact that you foresee?

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Sam Eswaran answered.
1 year ago
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If early estimates are anything to go by then the impact will be in the form of a few quarters of recession across the US, Europe and most of Asia. Morgan Stanley expects a deep global recession in the first half of 2020 due to the Coronavirus pandemic which has disrupted both demand and supply sides of the world economy. Global supply chains are badly hit and output has largely come to a standstill. Global GDP growth will decelerate by 2.3 per cent over the previous year in the first half of 2020, but it would recover in the second half of the year, according to Morgan Stanley. Due to the scale of the disruption, the actual impact on GDP could range from 2.3% to 3%. However, the impact of Coronavirus outbreak on the global economy could peak in April-May 2020, but growth was likely to recover only from the third quarter of 2020. However the first half will be an overhang on full year growth and the calendar year 2020 will could a decline of 0.6 per cent on y-o-y, breaching the 0.5 per cent y-o-y rate of contraction reported during 2008. This would also be the weakest pace of growth since the Great Depression that the world got to see in the late 1930s.

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