Nationwide shutdowns and limits the odds of a global “W-shaped” recession even as infections Combined with waning political will, we think this reduces the odds of renewed Knowledge of the virus has likely reduced the odds of a second wave that parallels theįirst wave. Premise that a vaccine is eventually made widely available and that the world’s increased Our outlook for the remainder of this year is uncertain, but we are basing it on the Globe by text mining the country reports of the Economist Intelligence Unit. World Uncertainty Index is a new measure that tracks uncertainty across the and Citi Personal Wealth Management as of May 2020. Sources: Ahir, H, N Bloom, and D Furceri (2018), “World Uncertainty Index”, This chart shows up and down spikes of economic uncertainty after major world events. We think it’s unlikely that we retest March’s stock market lows. We see no reason to think that this support will be removed Significantly improved financial conditions. However, in our view, central bank stimulus and government fiscal stimulus have In infections remains real and political tensions between the U.S. We acknowledge that the outlook is more uncertain than usual. We think these beaten down sectors will eventually catch-upĪs the economy recovers over the next 12 to 18 months. Stocks like cloud computing and home entertainment outperforming more cyclical “leave-my-home” stocks likeīanks, industrials, and travel-related stocks. This bifurcation has led to a divergence in equity market performance with “stay-at-home” Some service sectors like leisure and hospitality and international travel may take The recovery in financial markets may look much more “V-shaped” than the recovery in the broaderĮconomy. Vaccine could be delivered by early 2021 and lead to a sharp rebound in global growth - from a 3.5%Ĭontraction in 2020 to a 5.5% surge in 2021. With over 100 COVID-19 vaccines in development, we believe that a This is an engineered economic collapse that will likely generate an extremely deep, but brief global There are tentative signs that the global economy may be on the mend.

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