Economic activity rebounds globally even as Covid-19 cases rise: Moody’s

Moody’s Investors Service has said that high-frequency alternative data indicates a strong rebound in economic activity even as infection rates rise


Moody’s | Indian Economy | Global economy


Moody’s Investors Service has said that high-frequency alternative data indicates a strong rebound in economic activity even as infection rates rise and restrictive measures remain in place across many countries.

New infections are spiking again across 13 of the G-20 countries. Nevertheless, the number of fatalities has decreased in recent weeks as vaccinations gather pace.

The United Kingdom and the United States lead in vaccinations among the G-20 countries, said Moody’s in a sector in-depth report released on Thursday (local time).

Pent-up demand is driving a rebound in economic activity even as restrictive measures remain in place across many countries.

US household spending has risen above pre-Covid levels across all income groups, driven by retail, apparel and general merchandise spending.

The latest high-frequency data suggests a strong rebound in trade activity across G-20 countries. Industrial production and manufacturing data support a continued, although uneven supply-side recovery.

Financial conditions remain supportive in the US and Euro area, and they continue to improve in the UK. In contrast, the financial conditions recovery in emerging markets has stalled with conditions tightening in China, Brazil, Turkey and Argentina.

The latest retail sales data suggests a slower pace of contraction in Germany and the UK, and strong growth in the US, Australia and South Korea. Retail sales increased in Japan, reversing a contraction in January.

Moody’s said mobility data indicates that while workplace visits have slowed, consumer retail, recreation and park visits have increased across most countries. Time spent at home has decreased. Use of public transport remains below January 2020 levels, except in Japan and France.

In contrast, the overall recovery in emerging market financial conditions has stalled. Conditions remain tighter than historical averages, highlighting vulnerabilities to market volatility and capital outflows as the gap in the recovery between advanced and emerging markets widens this year.

(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.

We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor