To provide support to the falling global economy around the pandemic, the G-4 central banks promptly stepped up with some immediate monetary policy tools to support the falling economy, however, they could only soften the blow. The problem persists, and the way things are going with different countries, the immediate future does not look so bright economically either. We are nearing the end of 2020, but still millions of people are jobless, and the services sectors have not completely rebound even with the hope of the coronavirus vaccine.
As Bill Gates said that the full impact of the vaccine also will start showing results somewhere around February, March 2021. Until then, the COVID-19 cases are likely to rise to a frightening number, owing to the cold weather in many regions in the world.
The American Citizens’ Savings
Millions of people became jobless in 2020 in America, and although some data a while ago suggested that the savings of American households seem to be increasing as they are not indulging in careless expenditures, however, the latest data reveals that now those savings are also debilitating because more than half of the people who lost their jobs around March, April 2020 are still unemployed even after so many months.
Their unemployment benefits are also not going to be able to support them for long because of a tightening government fiscal policy.
The major impact of the economic fall-out was experienced by SMBs. Many of the small and medium-sized businesses had to permanently shut down due to the pandemic.
More than one-third of the employees in the Hospitality sector lost their jobs
This is quite a huge number. Hospitality employees in the UK and other European countries suffered a major loss because this sector is associated with many other industries, including tourism, travel, food, and services, etc. Since all other industries suffered, the blow to the hospitality sector was quite hard.
The healthcare and social work sectors saw many recruitments this year, and Singapore and Hong Kong have been found to have the best health-care systems.
Currency Manipulators
In the latest and the last foreign exchange policy report that Donald Trumps’ administration has recently presented reveals that the US Treasury Department has designated Switzerland and Vietnam to be currency manipulators and is keeping a vigilant eye on China’s activities and policies.
On the other hand, the Emerging Markets’ currencies are the most mispriced because of the divergence of exchange rates from fair-value estimates.
The Norges Bank is hopeful to raise the interest rates by 2022
Due to the pandemic, as an immediate monetary policy, the G-4 central banks slashed down the interest rates to almost zero. And even when the global economy started showing a little hope for recovery, the monetary policy remained unchanged. However, that is not good for individual economies of course. The central bank of Norway is hopeful to be able to increase the interest rates and may become the first world economy to be able to tighten its monetary policy with the help of an effective government fiscal policy.
Brazil’s central bank has predicted that even if the interest rates will hike, the rate of inflation will also increase by 2022.
China Shows Steady Rebound
With its retail and manufacturing sectors strengthening, China started showing an economic rebound and is expecting to see better results in 2021.
Some high-frequency data suggests that the stronger economies are gaining momentum now, but it is still a long way for the world to recover completely from the shock of the pandemic.
I’m Ava Paul, an experienced news website author with a special focus on the entertainment section. Over the past five years, I have worked in various positions of media and communication at World Stock Market. My experience has given me extensive knowledge in writing, editing, researching and reporting on stories related to the entertainment industry.
