Covid-19 Executive Briefing
Understanding the economic impact of the Covid-19 pandemic and the implications for the mining sector
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- ECONOMIC IMPACT -
Latest update: 11 May
Many economists have cut their GDP forecasts. The 2020 consensus forecast for GDP growth is currently negative and many predict a recession.
Major market indices are improving as, despite oil dipping below zero, it has rebounded quickly.
-2.3%
With economists cutting their forecasts in response to the pandemic, the 2020 consensus forecast for GDP growth is currently -2.3%.
14.7%
According to the US Bureau of Labour Statistics, the unemployment rate rose to 14.7%, the highest since the great
depression of the 1930s
Impact of Covid-19 on asset prices
- SECTOR IMPACT: Mining -
Latest update: 11 May
GlobalData analyst view:
"Lockdowns and closure of non-essential businesses and operations is particularly impacting platinum, copper, silver and gold, with only coal mines largely exempt."
The latest forecast for global construction output growth is a decline of 2.2%, versus initial expectations of 3.1% for 2020.
Lower automotive manufacturing will also impact demand for steel, aluminium, platinum, and palladium. Platinum demand is forecast to decline by 7% in 2020.
Mining suspensions have now been ended in Argentina, South Africa, India, Zimbabwe, Peru, and Bolivia. Governments in both Peru and Bolivia have allowed mines to return to operation from 2 May, provided they implement strict protocols to avoid the spread of Covid-19.
impact on capital expenditure
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