CRU: Vaccine Spring, Second Wave or Fiscal Tsunami—What Will Define 2021?

By CRU Principal Economist Alex Tuckett and Chief Economist Jumana Saleheen from CRU’s Global Economic Outlook

This month has brought good and bad news. On the one hand, vaccines are being rolled out, and further U.S. fiscal stimulus looks increasingly likely. On the other hand, the growing severity of the second wave of COVID-19 means the path to recovery will be more volatile and less predictable. The net outcome of these contrasting developments is negative for Q1, but positive further out. We have marginally revised up our 2021 forecast for growth in world GDP to 5.2%, and our 2022 forecast from 3.7% to 4.1%. We now forecast growth in world industrial production in 2021 and 2022 of 6.2% and 3.5%.