Coronavirus: IMF sees severe impact on global economy, but crisis temporary

People wear protective face masks, following an outbreak of the novel coronavirus disease (COVID-19), at Lujiazui financial district in Shanghai, China, March 19, 2020. (Reuters)

The impact of the global coronavirus pandemic will be “quite severe,” but a long expansionary period and high employment rates mean the global economy should weather the current shock, a top International Monetary Fund official said on Friday.

Martin Muehleisen, who heads the IMF's strategy policy and review department, said in an IMF podcast that the main goal for governments should be to limit the spread of the virus in a way that provides confidence that the economic shock will be temporary.

Read the latest updates in our dedicated coronavirus section.

He said banks and governments had already taken unprecedented measures to provide liquidity to markets and keep them functioning, “and maybe more will be needed,” but such steps should be coordinated internationally to amplify their effect.

“The better organized and the more coordinated the health responses to this crisis, the more quickly it may be possible that confidence returns,” he said.

Leaders of the Group of Seven rich nations last week said they would do “whatever it takes” to respond to the outbreak, but provided no specifics, which left markets unsettled.

The virus has infected more than 254,700 people around the world and killed 10,451. Efforts to contain the spread of the disease have resulted in severe shocks to both supply and demand around the world, rippling through to the financial sector.

SHOW MORE
Last Update: Saturday, 21 March 2020 KSA 07:29 - GMT 04:29
Top