Coronavirus: Chinese data to show devastating slump
Analysts are predicting that new data released this week could show China’s first-quarter GDP falling by as much as 10 per cent.
With the virus originating in the country, it was the first to be hit by the widespread economic disruption that has become the norm in most developed countries.
Speaking to the Sunday Times, David Owen of Jeffries described the data, to be released this week, as a “point of reference for European markets.”
The data will be a sobering moment for Beijing, with the regime more used to championing go-go growth figures than acknowledging it, like all governments, is vulnerable to external economic shocks.
Read more: UK should brace for economic hit
Last week, PwC economist John Hawksworth predicted the UK’s GDP as a whole for 2020 would fall by between 3 and 7 per cent.
“The future outlook remains highly uncertain, particularly as regards the length of the lockdown, but our analysis suggests a decline in GDP in 2020 as a whole of around 3-7% in plausible alternative scenarios, with a sharp fall in Q2 2020 and a gradual recovery later in the year and into 2021,” he said.
“The key priority, however, is effective implementation of the government’s plans to provide a safety net for businesses and workers to tide them through the next few weeks and months. This remains critical to limiting the longer term scarring to the economy through business failures and mass unemployment.
“If this safety net is effective, we would expect a quicker economic recovery than we saw after the financial crisis, even though the short-term fall in output will be much steeper due to the lockdown,” he added.