Mon, Aug 31, 2020

Tracking the COVID-19 economy

EconoGraphics by Nitya Biyani

Coronavirus Economy & Business European Union Eurozone Financial Regulation Japan Macroeconomics United States and Canada

China is experiencing an incredible Q2 economic rebound while the other 5 largest economies suffer historic downturns. This ‘fractured recovery’ puts enormous stress on supply chains and the global trading system. Can the rest of the world match China’s rebound in Q3? This is the most pressing question in the global economy today.

Note: All these graphs are interactive. Hovering over the graphs reveals details. By clicking on the variables in the legend, they can be removed or added to your liking.

Global Debt continues to rise and will be the theme of the conversation this week at the IMF/World Bank Annual meetings. The map below illustrates current levels of debt as a portion of GDP and the change from 2009.

Our new fiscal firepower heat map, updated through June, shows how G20 COVID-19 crisis spending now compares to the Global Financial Crisis. While nearly every country is spending significantly more than a decade ago, China is still spending less. 

Check out the interactive map and accompanying charts below to learn more about how each country is spending.

State tax revenue dropped nationwide, however they are rebounding in some parts of country.

Unemployment trends have varied at different stages of this crisis. This tells us about both, labor markets and the effectiveness of the government’s response. Youth unemployment is especially harder to compare, as NEET (Not in Education, Employment, or Training) means different things in different countries. For example, Japanese teenagers are less likely to pursue employment opportunities than their American counterparts, which is then reflected in the data. The jobs recovery is leaving behind the world’s youth. Our analysis shows youth unemployment remains particularly high in the US.

Fed Chairman Powell announced a significant change in US monetary policy and a departure from traditional inflation targeting last week at Jackson Hole. The graphs below illustrate the relationship between interest rates and inflation. The two countries that raised interest rates in 2015 and 2016 – the US and UK – experienced the largest political shocks.

As you can see, even when interest rates have increased the world’s largest central banks have been unable to get inflation above their target of 2%. That’s what prompted a rethinking from the Federal Reserve. 

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