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Global Economy: Recovery Slowing Down: DIW Economic Outlook

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  • Global Economy: Recovery Slowing Down: DIW Economic Outlook

    Can't find a date but this appears to have been written right before things took a turn for the worse with lockdowns so the second scenario seems the one we are heading into.

    https://ideas.repec.org/a/diw/diwdwr/dwr10-50-2.html
    Claus Michelsen & Paul Berenberg-Gossler & Geraldine Dany-Knedlik & Hella Engerer & Sandra Pasch, 2020. "Global Economy: Recovery Slowing Down: DIW Economic Outlook," DIW Weekly Report, DIW Berlin, German Institute for Economic Research, vol. 10(50).
    The present forecast assumes that the containment measures
    implemented in many countries will slow the spread in
    the short-term and prevent further uncontrolled, significant
    increases in the infection rate. New, expansive lockdowns are
    thus not assumed. In the first half of 2021, it is likely that
    containment measures will slowly be relaxed and replaced
    by gradual herd immunity. A moderate recovery can therefore
    be expected in the further course of the forecast. Global
    production will therefore probably reach its long-term growth
    path at the end of the forecast period.
    For example, global infection rates could continue to increase markedly
    despite containment measures, which would slow down the
    recovery process
    . Stricter containment measures that last
    into 2021 would be necessary and would lead to renewed
    slumps in economic output. A further risk is that there will
    be a sharp increase in corporate and private insolvencies in
    2021, which could lead to considerable loan defaults that
    would destabilize the financial markets, endangering the solvency
    of several countries.
    The recovery process in Europe is
    also likely to be slowed down considerably if an agreement
    between the EU and the United Kingdom fails despite the
    last agreement in the negotiations. Effective, faster containment
    of the pandemic through rapid herd immunity would
    strengthen the global upswing.
    _____________________________________________

    Ask Congress to Investigate COVID Origins and Government Response to Pandemic H.R. 834

    “‘i love myself.’ the quietest. simplest. most powerful. revolution ever.” ---- nayyirah waheed

    (My posts are not intended as advice or professional assessments of any kind.)
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