CORONAVIRUS TO CAUSE 'UNPRECEDENTED SHOCK' TO GLOBAL ECONOMY
The international rating agency has issued a statement on the effects of the novel Coronavirus on the global outlook.
The G-20 economies will experience an unprecedented shock in the first half of this year and will contract in 2020 as a whole, before picking up in 2021, according to the Moody's.
"We have revised our growth forecasts downward for 2020 as the rising economic costs of the coronavirus shock and the policy responses to combat the downturn are becoming clearer. We now expect G-20 real GDP to contract by 0.5% in 2020, followed by a pickup to 3.2% growth in 2021," it said.
In November last year, before the emergence of the coronavirus, the agency was expecting G-20 economies to grow by 2.6% in 2020.
"Fiscal and monetary authorities are increasingly stepping up the level of support to their economies to avert permanent damage to households and businesses. Globally, authorities are adopting important policy measures such as income guarantees and regulatory forbearance in an effort to reduce the risk of simultaneous defaults weakening financial stability. We expect policy measures to continue to grow and deepen, as the consequences of the shock in terms of depth and duration become clearer.
Nevertheless, downside risks to growth remain sizable," it added.