As coronavirus crisis escalates, Fitch Ratings expects a deep global recession this year, with the fall in 2020 GDP on par with the global financial crisis.
According to the latest update of its Global Economic Outlook, released Thursday, world economic activity will decline 1.9 percent in 2020. In March, the agency had forecast global growth of over 1 percent.
The rating agency expects US GDP to fall by 3.3 percent, the euro area by 4.2 percent and the UK to drop 3.9 percent this year.
China's recovery from the disruption in the first quarter of 2020 will be sharply curtailed by the global recession and annual growth will be below 2 percent, Fitch noted.
The rating agency observed that the lockdown policies implemented to control the spread of the coronavirus affected daily economic activity dramatically. The impact on GDP will depend on how long the lockdowns last.
"The forecast fall in global GDP for the year as a whole is on a par with the global financial crisis but the immediate hit to activity and jobs in the first half of this year will be worse", said Brian Coulton, Fitch's chief economist.
"Our baseline forecast does not see GDP reverting to its pre-virus levels until late 2021 in the US and Europe," Coulton added.