CaixaBank Research | The differences between countries in the severity and duration of the lockdown measures at the beginning of the year have been reflected in the declines in GDP in Q1. In Q2, the epicentre of the pandemic (and the lockdown) has moved from China to Europe and America, which will result in unprecedented declines in economic activity in the major advanced economies.
The Covid-19 outbreak leds to the steepest decline in business activity ever recorded in the Eurozone: it plummeted to 31.4 in March against 51.6 in February, a record low since July 1998. Even though manufacturing PMIs fell less than expected, they could have been inflated, once again, by longer supplier delivery times due to supply chain disruptions and thus send an overly optimistic signal, Susan Soho, economist at Julis Baer, explains. Moreover, they are likely to fall further in the coming month, as lockdown measures intensify.