- IMF provides $50bn to fight coronavirus outbreak.
- Organisation warned about the slowdown in this year’s global economic growth following the outbreak.
- Governments and central banks around the world have taken action to ease the impact of the virus.
- IMF offers to help poor and middle-income countries with weak health systems respond to the epidemic.
The International Monetary Fund announced a $50bn (£39bn) support for countries hit by the coronavirus, reports BBC News.
Economic slowdown
The organisation warned about the slowdown in this year’s global economic growth following the outbreak.
The need for an emergency measure came after the virus spread rapidly outside China to more than 70 countries.
This week governments and central banks around the world have taken action to ease the impact of the virus.
Money for the poor
The IMF is making the money available to help poor and middle-income countries with weak health systems respond to the epidemic.
2020 global output
The IMF said the spread of the coronavirus has wiped out expectations of stronger economic growth this year, pushing 2020 global output gains to their slowest rate since the financial crisis in 2008.
Impact too hard to forecast
But IMF managing director Kristalina Georgieva warned that it is hard to forecast just how big the effect will be: “Global growth in 2020 will dip below last year’s levels, but how far it will fall and how long the impact will be is still difficult to predict.”
Action taken to fight crisis
- On Tuesday the US central bank slashed interest rates in response to mounting concerns about the economic impact of the coronavirus.
- In its first emergency rate cut since the 2008 financial crisis the US Federal Reserve lowered its benchmark rate by 50 basis points to a range of 1% to 1.25%.
- Earlier the same day, both Australia and Malaysia cut interest rates in response to the outbreak.
- At the same time finance ministers from the G7 nations pledged to use “all appropriate policy tools” to tackle the economic impact of coronavirus.
- Also this week the World Bank committed $12bn (£9.4bn) in aid for developing countries grappling with the spread of the coronavirus.
- The emergency package included low-cost loans, grants and technical assistance.
World Bank Group President David Malpass said, “What we’re trying to do is limit the transmission of the disease.”
UK to follow the Fed?
In the UK, expectations are growing that the Bank of England could soon follow the Fed by announcing a rate cut.
New chancellor, Rishi Sunak, is expected to announce financial support for British businesses in next week’s budget as they deal with the coronavirus outbreak.
Did you subscribe to our daily newsletter?
It’s Free! Click here to Subscribe!
Source: BBC News
