The Japan Cabinet Office released GDP numbers for the fourth quarter of 2019. They were more than dismal. GDP dropped a breathtaking 6.3%. Combined with a blow to China’s economy, and figures which show Germany GDP has flattened, three of the four largest economies in the world are in very deep trouble.
Consensus forecasts for Japan GDP’s fourth quarter was for it to drop 3.9%.
Germany’s economy rose only .4% in the fourth quarter. That is as close to a recession as has been the case in years. The current quarter is not expected to be any better.
It is impossible to say what effect coronavirus has had on China’s economy. However, some experts forecast that the nation’s economic growth will be close to 0% when compared with the first quarter of 2019.
All this leaves the U.S. as the only global economy which continues to grow at a relatively strong pace. It is forecast to be between 2% and 2.5% this year. Coronavirus may effect the U.S less than many other large economies. However, trade with China could be sharply curtailed.
What typical economic cycles have not done in 10 years, a disease may well trigger now–a recession.
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