When it comes to the economic fallout of the COVID-19 pandemic, we have gotten used to negative superlatives over the past few months. We’ve seen some of the worst single-day losses in stock market history, followed by an unprecedented drop in consumer spending, a historic jobs crisis and what is likely the steepest and fastest decline in economic activity on record. The International Monetary Fund, which also slashed its growth forecast for the world economy between April and June, is nevertheless slightly improving its estimate for global GDP growth in 2020. The measure is expected at -4.4 percent, up from -4.9 percent in the June prognosis.
But the IMF, which has called the current situation “a crisis like no other”, is also toning down its optimism for a swift recovery in 2021. The updated estimates would result in a 2021 GDP that is roughly in line with 2019’s economic output and roughly 6 percent below pre-COVID-19 projections made in January 2020. Expecting a comeback of 5.8 percent growth in 2021, the organization now expects only 5.2 percent.
This chart shows the IMF’s global GDP growth forecasts published before and during the COVID-19 pandemic.
