The Global Economy after Covid-19: What to Expect?

Sponsored Post by IQ Option

Coronavirus has touched almost every corner of the financial markets. The global pandemic has disrupted normal economic activity around the globe, forcing many businesses to close their doors, causing a spike in unemployment rates, and resulting in a decline in trade. Now that several months have passed since the initial coronavirus outbreak, many are asking when economic activity will resume to normal, and what that may look like.

The World Trade Organization recently unveiled estimates indicating bleak numbers for 2020. The overall consensus is that economic decline will most likely surpass the global financial crisis of 2008-2009. Among the sectors most affected are merchandise trade — which may plummet between a whopping 13 and 30% this year — as well electronics and automotive products.

Despite the grim outlook, there is good news: the pre-pandemic world merchandise trade volume trend suggests that a strong recovery remains possible. Optimistically speaking, a recovery could start as soon as the end of 2020. On the other hand, the pessimistic scenario is that there will be more decline towards the end of 2020, with a rebound possible only at the beginning of 2021. The trajectory will depend on the decisions of policymakers and world leaders as they attempt to mitigate the effects of the pandemic.

The situation with coronavirus is changing daily, making it difficult to predict what will happen next. However, as countries begin to lift travel restrictions and reopen their restaurant industries, many are anticipating subsequent waves of coronavirus cases.

If coronavirus cases continue to surge worldwide, global markets may have more mayhem in store. Over the past few weeks, trading has been in a frenzy as investors turn away from riskier currencies and focus on safer ones, including the US dollar.

At the same time, some regions are taking on a more optimistic stance. Speaking at the online Northern Light Summit on Friday, June 26, European Central Bank president Christine Langarde said the euro zone is most likely “past the worst” of the economic crisis triggered by coronavirus. In the same vein, Langarde cautioned that trade will probably not be the same once the pandemic has passed.

To make matters even more complicated, increasing trade tension is exacerbating the market situation. With US President Trump considering a tariff tax on EU food products, and with a flailing deal with China in the works, the coming weeks could rattle the markets.

In this time of uncertainty, it appears that the one thing most world leaders can agree on is that monitoring coronavirus and its economic impact is crucial now more than ever. For the most part, the markets indicate that the path to economic recovery is still a long one ahead.

Investors interested in trading Forex during Covid-19 may want to follow economic events closely as the second wave of coronavirus cases emerges in some countries. If the economic downturn continues, currencies sensitive to risk may be caught in a sell-off.

--

Closely watching the performance of pairs is key in this fast-changing market situation. Brokers like IQ Option offer traders tools to keep tabs on the latest economic news and developments to make better-informed trading decisions. With an economic calendar, market analysis, and in-platform newsfeed, it has never been easier to stay in the loop. See it for yourself by opening a free demo account today.

Click here for more information

 
IQ Option

IQ Option is one of the fastest growing online trading brands in the world. Voted the best mobile trading platform, we have now expanded our offerings to include CFDs on stocks and ETFs, Forex trading, and the exclusive IQOption product called Digital Options. First founded in 2013, IQ Option has grown massively, and now has over 40 million members and counting! The platform itself has also undergone some changes since 2013, and we are constantly working to ensure it is fast, accurate and easy to use.

 

Archive

2020
July
February
January
2019
December
November
October
September
August
July
June
May
April
March
February
January
2018
December
September
October
November
October
November
October
September
August
July
June
May
April
March
February
January
2017
October
August
January
We use Cookies. By continuing to use this webite, you will be agreeing to our General Disclaimer & Warning.