Macroeconomic effects of Covid-19: an early review

Key takeaways

• Past epidemics had long-lasting effects on economies through illness and the loss of lives, while Covid-19 is marked by widespread containment measures and relatively lower fatalities among young people.
• The short-term costs of Covid-19 will probably dwarf those of past epidemics, due to the unprecedented and synchronised global sudden stop in economic activity induced by containment measures.
• The current estimated impact on global GDP growth for 2020 is around -4%, with substantial downside risks if containment policies are prolonged. Output losses are larger for major economies.