Global economies have been hit hard by the coronavirus pandemic, which rattled each and every sector all around the world and tampered with market dynamics in an unprecedented way.

The economic impacts of the COVID-19 outbreak became more obvious as major credit rating agencies including Fitch Ratings and Moody’s Investors Service cut their growth forecasts or lower credit notes of several countries regarding 2020 and 2021.

Moody’s cut growth estimates for India, G20 countries and Turkey

India

The agency slashed India’s growth forecast for 2020 to 0.2% from 2.5% projected in March. This downward revision was mainly driven by the largest ever nationwide lockdown that crippled the country’s economy. For 2021, however, Moody’s expects India’s growth level to rebound to 6.2%.

G20 countries

Moody’s lowered its real GDP projections for G20 countries as the virus-led lockdowns caused the global economy to almost shut down, deepening the global recession fears. Accordingly, G20 countries are expected to contract by 4% in 2020 from the agent’s earlier projection of a 0.5% fall in growth levels. The bloc is forecast to grow by 4.8% in 2021, the agency said in a report.

Turkey

Turkey’s economy is estimated to narrow by 4% this year due to the impacts of the coronavirus. On the other hand, Moody’s foresees an expansion of 3.5% in Turkish economy during 2021.

Fitch Ratings’ projections on other economies

Italy

Rating agency Fitch lowered Italy’s credit rating to “BBB-minus” from “BBB”, saying that the downgrade reflects the impact of the COVID-19 outbreak on the Eurozone’s third largest economy.

Earlier in April, economists warned that Germany’s GDP for 2020 may be down by 2.8% to 5.4% before a rebound in 2021. Spain is expected to see a 5.2% drop in GDP for the current year before seeing an 8.3% growth next year.

Global economy

The world economic growth is set to decline by 3.9% in 2020, due to the economic slowdown and lockdowns related to the ongoing coronavirus (COVID-19) pandemic, Fitch Ratings projected in its updated Global Economic Outlook (GEO) forecasts released in late April.

Source : Chemorbis