Virus infects world economy

Virus infects world economy

Concern over the coronavirus outbreak has had a massive impact in global financial markets and the volatility appears set to persist for weeks, if not months. The wild swings in markets, many of which have recorded their worst week since the global financial crisis over a decade ago, have come as traders fret about the economic impact of the outbreak. Supply chains are disrupted and tourism and business and consumer confidence are faltering. China, the epicenter of the outbreak, is bearing the brunt of the economic fallout. But the spread of the virus is now beginning to affect other economies, not least Italy, which has seen a spike in virus cases. The Organization for Economic Cooperation and Development has slashed its growth forecasts for all major economies as it warned that the global economy is facing its “biggest danger since the financial crisis.” It now estimates global growth will be only 2.4% this year, down 0.5 percentage point from its previous forecast just in November. It warned that growth could be as weak as 1.5%. Luckily, for most people investing is a long-term game.