2020 Review & 2021 Outlook

Rothschild & Co AM
By December 18, 2020 15:06

2020 Review & 2021 Outlook

The Covid-19 pandemic brought about a synchronised global recession of historic proportions. On the other hand, unprecedented fiscal support measures cushioned the impact of the health crisis, while monetary policies also played a major role through swift and, in some cases, innovative actions that improved market liquidity and limited the increase in borrowing costs.

The global economic recovery is proving to be uneven, above all between the manufacturing and service sectors, and rarely in the past has there been such a significant gap to the detriment of the latter. Indeed, the public response to slow the transmission of the virus, combined with changes in behaviour, has resulted in a sharp decline in activity for sectors that rely on social interaction, particularly retail, hotels, restaurants and entertainment. Moreover, the divergence between China and the rest of the world – the “first in, first out” phenomenon – is striking. In Europe, a first wave hit the continent in March, then a second wave from October, which will result in a drop in GDP in Q4. In the United States, the Trump Administration’s chaotic management of the health crisis will also leave its mark on economic activity. Conversely, the Chinese situation is continuing to improve. 

Rothschild & Co AM
By December 18, 2020 15:06

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