In this article, I will discuss the on-going trending topic Coronavirus (also known as COVID-19) and The Global Economy.
The new coronavirus first emerged in the Chinese city of Wuhan last December. The virus outbreak has become one of the biggest threats to the global economy and financial markets. Major institutions and banks have cut their forecast for the global economy with the organization for economic cooperation. Fears of the Coronavirus impact on the global economy have rocked markets worldwide, plunging stock prices and bond yields. Here are six fields that show the impact the outbreak has had on the global economy and the markets so far.
- Downgrades in the economic forecast: The outbreak has led major institutions and banks to cut their forecast for the global economy. The Asian economy is expected to grow by 4.9% this year, slower than the earlier forecast of 5.7%, according to the OECD.
- A slowdown in manufacturing activity: The manufacturing sector in China has been hit hard by the virus outbreak. That along with a rapid spread of COVID-19 outside China means that global manufacturing activity could remain subdued for longer, economists say.
- Services contraction: China is not the only country where the services sector has weakened. The service sector in the US, the world’s largest consumer market, also contracted in February, according to IHD Market, which compiled the monthly PMI data.
- Declining oil prices: A reduction in global economic activity has lowered the demand for oil, taking oil prices to multi-year lows. That happened even before a disagreement in production cuts between OPEC.
- Stock market rout: Fear surrounding the impact of COVID-19 on the global economy has hurt investor’s sentiment and brought down stock prices in major markets.6. Lower bond yield: Concerns over the global spread of the new coronavirus have also driven investors to bid up bond prices resulting in lower bond yields in major economies.
- Lower bond yield: Concerns over the global spread of the new coronavirus have also driven investors to bid up bond prices resulting in lower bond yields in major economies.
- Digital ad rates down: Due to coronavirus, online digital advertising ads rates have been decreasing.