Covid-19 Executive Briefing
Understanding the economic impact of the Covid-19 pandemic and the implications for the mining sector
- ECONOMIC IMPACT -
Latest update: 07 July
Many economists have cut their GDP forecasts. The 2020 consensus forecast for GDP growth is currently negative and many predict a recession.
Although concern over the spread of Covid-19 has increased significantly, business optimism continues to improve
Goldman Sachs forecasts the US economy will contract by 4.6% in 2020.
The World Bank forecasts Russia’s 2020 GDP will contract by 6%, an eleven-year low, with a moderate recovery in 2021-2022.
Impact of Covid-19 on asset prices
- SECTOR IMPACT: Mining -
Latest update: 01 July
GlobalData analyst view:
"Commodity prices began to stabilise in May, supported by rising demand from China and continued supply constraints, whilst sentiment is improving as lockdowns end."
The latest forecast for global construction output growth is a decline of 3.2%, versus initial expectations of 3.1% for 2020.
A slowdown in construction has impacted copper and steel demand, with copper demand forecast to be down by 3% in 2020 and iron ore demand down by 2.8%
Suspensions of mining have ended in most countries with mining in Mexico permitted to resume on 1 June.
impact on capital expenditure