Subscribe to Outbreak, a daily newsletter roundup of stories on the coronavirus pandemic and its impact on global business. It’s free to get it in your inbox.
The International Monetary Fund said it expects a global recession this year that will be at least as bad as the downturn during the financial crisis more than a decade ago, followed by a recovery in 2021.
Nearly 80 countries have asked the Washington-based IMF for emergency finance, Managing Director Kristalina Georgieva said in a statement Monday following a conference call of Group of 20 finance ministers and central bankers. Georgieva said the fund strongly supports extraordinary fiscal actions already taken by many countries and welcomes the moves of major central banks to ease monetary policy.
“These bold efforts are not only in the interest of each country, but of the global economy as a whole,” she said in the statement. “Even more will be needed, especially on the fiscal front.”
The statement followed the G-20 officials convening an emergency call on Monday to discuss the global economic fallout from the pandemic and work toward a joint response. Also Monday the Federal Reserve unveiled a sweeping series of measures including for households and employers that push it deeper into uncharted territory.
The IMF said it’s working closely with other international financial institutions to provide a strong coordinated response, and reiterated that it’s ready to deploy all of its $1 trillion lending capacity.
To have a rebound next year, “it is paramount to prioritize containment and strengthen health systems — everywhere,” Georgieva said. “The economic impact is and will be severe, but the faster the virus stops, the quicker and stronger the recovery will be.”
The IMF noted that major central banks that have initiated bilateral swap lines with emerging economies may need to provide more. The fund said it’s also exploring a possible proposal that would help facilitate a broader network of swap lines, including through an IMF-swap type facility.
More must-read stories from Coins2Day:
—Why the extraordinary dollar surge spells more trouble for the global economy
—These estimates of how much COVID-19 will hurt the economy are terrifying
—The NYSE is closed because of the coronavirus. What that means for investors
—How thinking like a golfer can help you ride out market mayhem—Listen to Leadership Next, a Coins2Day podcast examining the evolving role of CEO
—WATCH: U.S. Tax deadline moved from April 15 to July 15
Subscribe to Coins2Day’s Bull Sheet for no-nonsense finance news and analysis daily.
