PIB deve retrair para 1,6% nesse ano de 2020 25/03/2020

For Moody's, the coronavirus is set to deliver an unprecedented shock in the first half of this year. And G20 economies could retract 0.5%

Moody's, risk classification agency Moody's shared in a report this Wednesday the 25th, that the Gross Domestic Product (GDP) of Brazil should have a drop of 1.6% in 2020. For 2021, the agency already makes an optimistic forecast with advance of 2.7%.

The agency also revised downwards its projections in relation to the growth of other economies that are part of the G20. According to the report released by the company, it is estimated that the group will register a drop of 0.5 this year. And for 2021, the estimate is an increase of 3.2%.

PIB deve cair para 1,6 nesse ano de 2020 25/03/2020

For Moody's, the impacts of the new coronavirus pandemic caused the G20 economies "an unprecedented shock in the first half of 2020".

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On the US economy, the agency predicts a recession of 21TP3Q. And next year, the estimate is for growth of 2.1%. For Germany's GDP, which corresponds to the largest economy in Europe, the possibility of a drop for 2020 is 3%. In the year 2021, the projection for the GDP of the European country is a growth of 2.5%. For China, the forecast is also for a retreat, but it is estimated that even so the country's GDP should grow 3.3% this year. For 2021, the agency expects an advance of 6% in the Chinese economy.

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Moody's stressed that it is not possible to be certain about the impacts of the coronavirus crisis. According to the agency, the acceleration of the pandemic around the world may be an indication of a period with greater restrictive measures. As a result, economic activity may suffer even more effects.

Moody's analysis of the impact of the coronavirus in Brazil

For the company, even with the measures stipulated by the Brazilian government to cushion the effects of the coronavirus, they are reducing much of the impact on economic activity. The negative impact on employment and growth remains severe.

There will be a fiscal cost due to the economic and monetary measures taken. In addition, these measures should have a limited impact on investment and consumption, given the impact on consumer demand due to social isolation to contain the virus. “The government's ability to provide a stronger fiscal response is constrained by its fiscal deficit,” Moody's said.

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