Assessing the impact of Covid-19 – wait another 3 weeks
Responding to CNBC, US Treasury Secretary Steven Mnuchin said US officials will have a better assessment of the impact of the Covid-19 epidemic on the economy in the next three or four weeks.
`We will need another three or four weeks to see how the coronavirus will impact the US economy, when we actually have good statistical data,` Mnuchin said.
US Treasury Secretary Steven Mnuchin.
When asked whether the US had a contingency plan for financial markets given the virus outbreak, Mnuchin said there was `no question about this`.
`I think based on what we see now the impact will be contained, but the situation could change,` Mnuchin said.
In early February, analysts at Goldman Sachs predicted that the US growth rate might only decrease by 0.4% in the first quarter. However, in the second quarter, GDP growth will accelerate again.
However, over the weekend, according to the Wall Street Journal, data company IHS Markit said that the US composite output index, a measure of aggregate activity in the service and manufacturing industries, fell to 49.
The decline in the US composite index was mainly due to weak service sector output this month.
`This downturn is partly related to the coronavirus outbreak, which is reflected in weak demand in sectors such as transport and tourism, exports and supply chain disruptions,` said Chris Williamson, Business Analyst.
US Treasury stocks and interest rates decreased on February 21.
Economists predict that the Covid-19 epidemic will have a certain impact on global growth.
According to forecasts of the International Monetary Fund (IMF), the pneumonia epidemic could reduce global growth by 0.1% in 2020. Meanwhile, China’s growth is forecast to decrease to 5.0%.
In a study on Covid-19 published last week, Chinese researchers estimated the coronavirus mortality rate to be 2.3%, with the elderly and those with poor health at risk.
However, some experts believe that the total number of infections may be much higher than announced, which makes the death rate likely lower than current estimates.
