New Delhi: Ratings agency Moody’s on Monday said due to pandemic second quarter of the current fiscal will go down in history as the worst quarter for global economy since World War 2.

Moody’s sees India’s GDP contracting 3.1% in 2020 and growing 6.9% in 2021.

In its Global Macro Outlook report, Moody’s said effects of lockdowns on global activity during second quarter will be larger than expected earlier.

Moody’s expects China to be the only G20 country to post growth in 2020 (1% growth in 2020, 7.1% growth in 2021).

Moody’s expects a gradual recovery for global economy from the beginning of second half of 2020.

Moody’s expects G20 economies to contract by 4.6% in 2020 and grow by 5.2% in 2021.

The report also touched upon the skirmishes happening on LAC.

“The Asian countries are particularly vulnerable to changes in geopolitical dynamics, finds the report highlighting that China’s clashes with countries bordering the South China Sea, India suggest geopolitical risks rising for the entire region,” the report said.

The coronavirus will push debt levels in the world’s richest nations up by almost 20 percentage points on average this year, Moody’s said on Monday, almost double the damage seen during the financial crash.

A new report by Moody’s looked at 14 countries from the United States and Japan to Italy and Britain and assessed how coronavirus-induced economic slowdowns would scar their finances.

“We estimate that on average in this group, government debt/GDP ratios will rise by around 19 percentage points, nearly twice as much as in 2009 during the Great Financial Crisis”.

“Compared with the GFC, the rise in debt burdens will be more immediate and pervasive, reflecting the acuteness and breadth of the shock posed by the coronavirus”.

With inputs from Reuters

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