International

Countries Brace For Global Economic Impact Of Coronavirus

economic impact

Canada Finance Minister Bill Morneau said that the coronavirus is probably going to have a “real” impact on that country’s economy, according to a report Monday (Feb. 10) by Bloomberg. Countries are keeping watch on the spread of the virus and its potential economic effect.

Morneau spoke about the virus for the first time at a breakfast speech in Calgary, and he said the coronavirus is going to have a “significant” impact, one that will disrupt tourism and supply chains. Oil prices have fallen 15 percent as demand has slowed down.

“I do want to acknowledge the virus is undoubtedly going to have an economic impact,” Morneau said per reports. “We know the impact is real.”

The virus, which has killed 910 people, has claimed more lives than the 2003 outbreak of SARS.

Burger King restaurants in China have also been affected by the virus, according to a report by Bloomberg, and it’s closed half of its restaurants in the country.

The closing means impacts 1,300 restaurants, and Restaurant Brands International, which also owns Popeyes and Tim Hortons, said it was watching the situation carefully. There are about 30 Tim Hortons in China.

“Most of the closures are being driven by local regulations. In some cases, malls are closing,” Chief Executive Officer Jose Cil said. “It’s too early to tell what impact, if any, it’s going to have on short-term performance or results.”

Other restaurants, especially in the Hubei province, where the disease is said to have originated, is closing its doors as well. Starbucks, McDonald’s and Dunkin’ Donuts have all closed some locations.  

CNBC is reporting that the coronavirus concerns are probably going to affect U.S. Q1 growth, but that the equity market is not as spooked as the bond market. 

Forecasters predict Q1 GDP to be around 1.2 percent, which is down a whole point from Q4. Depending on how bad the virus becomes, some economists see the GDP bouncing back 2 percent.

“Rate markets are sending warning signs, creating renewed disconnect between rate and equity markets,” JPMorgan said in a report. “What we find complacent is the idea among some market participants that Chinese economic weakness will have limited repercussions for the rest of the world.”

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NEW PYMNTS DATA: HOW WE SHOP – SEPTEMBER 2020 

The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.

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