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Government support for German companies in the corona crisis
Jan SchildbachSebastian Becker
Fighting the corona crisis: Whatever it takes.
Fighting the corona crisis: Whatever it takes. The government’s support measures so far include greater access for firms to short-time allowance, tax moratorium and the potential provision of state guarantees of up to EUR 460 bn. We expect the government to come up with additional fiscal stimulus measures soon. The budget balance could post a deficit of 3.5% of GDP in 2020/21. (Also in this issue: KfW programmes to support corporate Germany – A primer. Corporate lending in a corona recession: Development banks as an anchor of stability?) [more]
With Germany’s rather successful COVID-19 strategy and the recovery and stimulus packages broadly agreed, the question of Merkel’s successor and the next German federal elections in autumn 2021 are gradually getting closer political attention again. [more]
How deep is your trough? Daily activity trackers suggest that the economy turned at the end of April as lockdown measures were gradually lifted. But we still expect a double-digit decline in Q2 GDP. [more]
Based on DB’s GDP forecast, due to the COVID-19 crisis annual global goods trade will shrink by 13.6% in 2020 and will recover by only 7.5% in 2021. Global goods trade is set to fall much heavier than during the GFC. [more]
The COVID-19 pandemic and, in particular, lockdown measures will push the German economy into its biggest slump since WW2. The COVID-19 pandemic hits German labour market differently than the Global Financial Market Crisis of 2009. [more]
Weaker-than-expected March hard data and shocking April survey data point to a lower trough in economic activity than assumed so far. We now see Q2 GDP falling by 14% qoq, with the risks still skewed to the downside. [more]
Merkel’s cabinet in consultation with the PMs of the 16 federal states agreed to partially lift containment measures but curbing health risks clearly dominated economic risks of a longer shutdown. [more]
Corona recession – depth probably close to 2009 slump. Within days lock-down measures and (temporary) factory closures have reached a level that suggests a far bigger H1 contraction than previously thought. [more]