Previous forecasts regarding the consequences of the epidemic were incorrect.
This was reported by the publication “Business Insider”, referring to the data of the American financial holding “JPMorgan”.
JPMorgan is one of the four largest US banks along with Bank of America. Founded by John Morgan in the late 19th century, the company is today among the leaders of the world’s largest public companies according to Forbes Global 2000. And since 2011, JPMorgan has been one of the systemically important banks.
The company’s economists initially suggested that the coronavirus epidemic COVID-19 would entail a serious but short-term shock to the global market. However, they revised the forecast taking into account new events, and now they are waiting for a “much sharper” economic collapse in the first half of 2020 and even a “new world recession”.
The first factor that the experts took into account is that emergency measures at the level of individual countries entailed a “sudden stop” in all economic activity. Sports, cultural, business events were postponed, which led to a reduction in consumer spending. The situation is aggravated by the fact that coronavirus is an extremely unstable factor, which seriously complicates the work on “resetting” the economy.
“Given that we have already come to terms with the inevitable strong and massive shock to global growth, the main question now is whether we can eliminate the familiar and protracted collapse”, – JPMorgan said.
In numbers, the forecast of American financiers is as follows: already in the first quarter, US GDP will decrease by 2 percent, and in the second – by 3. At the same time, EU GDP will decrease by 1.8 and 3.3 percent, respectively. Moreover, already in July, the EU and the US may face a recession of catastrophic proportions.