Slowdown not to stay for long! Anil Singhvi decodes Morgan Stanley's V-shaped sharp recovery assertion
During the Coronavirus lockdown, the global economy got caught by the slowdown but after the gradual re-opening, some signs of recovery are becoming visible.
During the Coronavirus lockdown, the global economy got caught by the slowdown but after the gradual re-opening, some signs of recovery are becoming visible. Comparing this financial crisis with the 2008 subprime loan crisis, Morgan Stanley has said that the current economic crunch will be short-lived and V-shaped sharp recovery is expected soon.
Zee Business Managing Editor Anil Singhvi decodes the entire study for investors and goes deep into the reasons highlighted by Morgan Stanley, which made it come out with such a bold announcement. Speaking on the reason for such bullish announcement, Anil Singhvi said, "Morgan Stanley is of the opinion that the recovery in the global economy will be V-shaped not 'W' or 'U.' The reason for such V-shaped sharp recovery is sharp rise in GDP as the Coronavirus is a health-related issue and the economy is still well in control."
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Singhvi said that if we compare the current slowdown in the global economy, the recovery will be very sharp and the fall will be limited.
Highlighting upon the reasons that helped Morgan Stanley to come out with such findings Singhvi said, "Morgan Stanley is of the opinion that global Gross Domestic Product (GDP) growth in the Q1CY21 is expected to remain around 3 per cent but in Q2CY21 this number is expected to hit 8.6 per cent. This is possible only because there is sharp recovery coming and Coronavirus impact on the global economy is not going to live long."
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The market guru also said that Morgan Stanley findings suggest that by Q4CY21 global economy is expected to hit its pre-COVID levels and manufacturing is expected to match its pace soon.
Significantly, the biggest takeaway was explained by Anil Singhvi when he pointed out that the global economy is in expansion mode and hence this will be the shortest slowdown in the history of global economy.
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