New infection rates are rising in seven of the G-20 economies. Infections have begun to level off in the United States, Canada and Latin America although they remain at high levels in some areas, but infections are rising across Europe and Asia.
High frequency alternative data indices suggest a synchronised pickup in trade activity across the G-20 economies. But manufacturing activity is lagging in Japan, Korea and Mexico.
However, new data suggest that the rebound in retail sales is slowing down. Also, high frequency data for August and early September point to a slower pace of recovery in economic activity across the United States and euro area, and to a deterioration in China.
Even though fiscal support to households and an accumulation of savings have led to a consumption rebound, concerns about the pandemic globally are still deterring consumers from engaging in high-contact economic activities.
Moody's proprietary indices show that US financial conditions have returned to long-term historical levels while improvement in the euro area and emerging markets is gaining traction, albeit at a slower pace. However, financial markets momentum can reverse if the virus continues to spread.
Additionally, while advanced economies have larger capacity for fiscal and monetary stimulus, policy support in emerging markets might be constrained, further hindering the recovery of economic activity.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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