ANI
04 Dec 2020, 12:57 GMT+10
Singapore, December 4 (ANI): The COVID-19 pandemic will continue to put a heavy strain on global credit conditions in 2021 despite positive news on a vaccine, SP Global Ratings said on Friday in its 'Global Credit Outlook 2021: Back On Track?'"Even if a vaccine becomes widely available by mid-year which we assume in our baseline, the containment of pandemic will be very uneven worldwide," said Alexandra Dimitrijevic, Global Head of Research at SP Global Ratings.
"Until then, the main risk for the first half of 2021 is that further waves of COVID-19 cases requiring renewed containment measures may harm a fragile economic recovery and lead to further credit deterioration, particularly in sectors most exposed to social distancing and travel restrictions."With economic momentum fading as COVID cases surge again, SP forecast a weaker start to 2021 although the 2022-2023 GDP forecast is broadly unchanged.
"We expect full-year global GDP growth at 5 per cent, down 30 basis points from its previous forecasts. For China -- first into the crisis and first out -- we see GDP expanding by 7 per cent next year as acute downside risks ease and some upside emerges."The United States and Europe are mired in a second wave of COVID-19 but extensive vaccine purchases lined up by their governments support prospects of a turnaround in the second quarter.
"We forecast 4.2 per cent GDP growth in the United States and 4.8 per cent for the Eurozone in 2021. For emerging markets, financial pressures may hamper the pace of recovery," said SP.
After peaking at 265 per cent of global GDP at the end of 2020, global leverage is likely to ease only slightly in 2021, and mostly as a result of a rebound in global GDP.
With vaccine availability and a rebound in the global economy, the focus in the second half of 2021 will likely turn to the gradual unwinding of extraordinary fiscal support, revealing the extent of credit losses for banks.
SP said governments, meanwhile, face the difficult task of balancing the near-term risks of premature austerity with a medium-term need to put debt on a declining path. (ANI)Get a daily dose of Japan Herald news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Japan Herald.
More InformationBERLIN, Germany: Talks between the EU and China could pave the way for a shift from tariffs to minimum price agreements on Chinese...
BEIJING, China: Tesla has halted new orders in China for its two U.S.-made premium models as trade tensions between Washington and...
TAIPEI, TAIWAN: A strong push from artificial intelligence demand lifted TSMC's quarterly revenue to new highs, with the chipmaker...
Xi arrives in Kuala Lumpur for state visit to MalaysiaChinese President Xi Jinping arrived here Tuesday for a state visit to Malaysia.He...
Washington DC [US], April 16 (ANI): White House Press Secretary Karoline Leavitt responded to questions on China during the White House...
The US president insists his trade policy could generate billions in revenue US President...
NEW YORK, New York - U.S. stocks ended with minor losses on Tuesday as investors and traders continued to navigate markets with continued...
DETROIT, Michigan: General Motors is hitting pause on production of its BrightDrop electric vans in Ontario, Canda, citing the need...
BERLIN, Germany: Talks between the EU and China could pave the way for a shift from tariffs to minimum price agreements on Chinese...
BEIJING, China: Tesla has halted new orders in China for its two U.S.-made premium models as trade tensions between Washington and...
NEW YORK, New York - Automakers and tech companies helped to lift U.S, stock indices Monday as stock markets around the world saw a...
NEW DELHI, India: India is pushing to fast-track a trade agreement with the United States following a temporary pause on new tariffs,...