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Corona crisis and the economy
The Corona Crisis is restricting social life in a way that many of us have never experienced before. We face many new challenges in both our professional and personal lives.
Many people, especially in the health system and the retail sector, are currently working at full capacity. At the same time, the rest of the population is called upon to stay indoors as much as possible. Whether for private meetings or for work, physical presence in the head should be avoided as far as possible. Experts believe that the current situation could last for several months - albeit with some relaxation. What are the economic trends for a "time after Corona"?
Caesura in the global economy
So-called leading economic indicators provide the first clues. Recently, the sentiment barometers in many countries and regions reached new lows. Current forecasts may look shocking at first glance, but there is certainly reason for hope.
The current situation and the general uncertainty are a particular burden on companies. The impact on global economic activity is very much dependent on how long policy measures remain in place and how extensive they will be in the future. Governments and central banks around the world have reacted quickly to ensure direct support for businesses and a functioning financial system. These interventions can and are cushioning the impact on the economy of traders in https://exnesslatam.com/tipos-de-cuentas/ and consumers.
Governments adopt liquidity support, central banks loosen their stance
In Germany, for example, emergency and liquidity assistance for businesses was adopted, an economic stabilisation fund was set up and regulations on short-time work were made more flexible. All in all, this amounts to about 353 billion euros in budgetary measures and almost 820 billion euros in guarantees.
For comparison: the costs of the bank bailout during the financial market crisis amounted to about 68 billion euros, according to the Ministry of Finance. Within the European Union, the debt limit of the member states was suspended in order to give the individual countries considerably more leeway.
In the USA, too, a two-trillion US dollar aid programme was adopted to support consumers and businesses during the crisis.
In addition to governments, central banks are also making efforts on an unprecedented scale. The European Central Bank announced, among other easing measures, a new bond-buying programme of 750 billion euros in 2020. The US Federal Reserve lowered interest rates by 1.5 percentage points, is even buying unlimited amounts of bonds and is directly financing companies for the first time.
All measures are aimed at getting as many companies as possible through the crisis unscathed. However, corporate bankruptcies and rising unemployment figures can hardly be prevented. If the economy can function largely without restrictions again in the second half of the year, the recession is likely to end. However, the recovery process will take a longer time. Precise estimates of the long-term consequences cannot be made at this stage.