Page 3 - Investment Outlook
P. 3
Coronavirus Crisis
As equity markets fell, so did bonds as investors sought the safety of cash and in particular US$.
The massive and decisive intervention by the US Federal Reserve in March to extend its quantitative easing programme to buy up bonds and other credit gave stability to credit markets and with that equity markets.
The global value of money committed to coronavirus measures that support economies, employers and families has been valued at around US$5tn and rising. Bloomberg Economics think that the crisis will cost the world economy US$6tn or the equivalent of a 7% fall in global GDP. The Asian Development Bank (ADB) puts this figure between US$ 5.8tn and US$8.8tn, which is 6.4% to 9.7% of global GDP. Their assumptions were based upon a lockdown of three months and restrictions lasting six months.
Financial Advice & Wealth Management 2
