If the epidemic-related restrictions in the eurozone last for six weeks, aggregate GDP could fall by 2 per cent, while if it lasts 4 months, it will be a 10 per cent minus, according to a recent S&P forecast.
Although Germany (AAA), the United States (AA +) and France (AA +) still have the best debtors' ratings, Standard & Poor's predicts a significant economic downturn in all three countries due to the coronavirus epidemic, MTI writes. referring to its latest forecast.
S&P experts say the U.S. economy will go into recession in the second and third quarters. The unemployment rate could reach a 10 percent level not seen since 1948 in the second quarter and then improve to 7 percent by the end of the year. At the S&P, a $ 2,000 billion fiscal stimulus package, unprecedented in economic history, is seen to mitigate the negative social, economic and financial effects of the coronavirus epidemic. According to the credit rating agency, the epidemic will be brought under control in the United States by the middle of the year. Overall, according to S&P, after a 1.3 percent decline in U.S. GDP this year, growth is expected to reach 3.2 percent in 2021 and 2.5 percent a year later.
The length of the restrictive measures due to the epidemic in the German economy will determine the extent of the decline. However, the German economy is particularly vulnerable to this type of shock on both the supply and demand sides. According to the S&P forecast, German GDP could shrink by 1.9 percent in 2020, but next year a surplus of 2.6 percent can be expected. France expects a 1.7 percent decline in GDP this year, while Standard & Poor's expects a 1.9 percent economic downturn in Germany in 2021 as a whole by 2020, while next year it expects 2.6 percent growth in German gross domestic product (GDP). In France, S&P expects a decline of around 1.7 percent in 2020.
According to S&P, if the restrictions are in place in the eurozone for six weeks, the aggregate GDP of countries using the euro could fall by 2 percent, while if the restrictions last for 4 months, a 10 percent minus would be expected.