Goldman Sachs, the world’s largest investment bank, represented by chief economist Jan Hatzius, has made a forecast for the GDP reduction in developed countries. The analyst believes that the reduction in the second quarter may total 35% compared with the first quarter of 2020.
The spreading pandemic of the coronavirus caused such a serious decline. If the forecast is true, then the fall will be four times higher than the previous anti-record. It should be noted that such anti-record was observed in 2008 against the backdrop of the global financial crisis.
It is difficult to predict how quickly developed countries will be able to return to normal functioning. A prerequisite for this is the return of people to work but nobody knows when this happens.
The economist noted that most countries had overcome the peak in the number of new cases of the disease. But according to Hattzius, is too early rejoice. The expert believes that remaining in isolation is the reason for improving the situation. The resumption of social contacts may well cause the second wave of growth in patients.
Many European countries help businesses and people by providing access to cheap loans and easing fiscal policy. This is what we call “deeds not words”. Mr.Hatzius believes that more help should be provided, which means pouring money not only into national economies, but also into less affluent neighboring states. The expert said that the help of rich countries to developing markets would help maintain the integrity of the eurozone.
The material was prepared with the participation of Katya Wilson,
a leading analyst of the brokerage company UFT Group