Global recession likely if coronavirus becomes pandemic: Moody's Analytics

A global recession is likely if coronavirus becomes a pandemic, and odds of that are uncomfortably high and rising with infections surging in Italy and Korea, Moody's Analytics said on Wednesday. " coronavirus has been a body blow to Chinese ecomy, which w threatens to take out entire global ecomy," Chief Ecomist at Moody's Analytics Mark Zandi said.

Tourism industry takes a major hit

outbreak of virus, officially called COVID-19, was first detected in Wuhan in China in December and has since affected thousands of people across globe.

"COVID-19 is battering global ecomy in numerous ways. Chinese business travel and tourism has all but stopped; global airlines are t going to China and cruise lines are cancelling most Asia-Pacific itineraries. This is a huge problem for major travel destinations, including in US, where some 3 million Chinese tourists visit each year," Moody's Analytics said.

Chinese tourists to US are among biggest spenders of any foreign tourists. Travel in Europe is also sure to be severely impacted as Milan, Italy, centre of new infections in that country is a major travel hub for Continent.

Shuttered Chinese factories are also a problem for countries and companies fastened into China's manufacturing supply chain. Apple, Nike and General Motors are some prominent American examples.

Shorts of some goods will likely result this spring, meaning higher prices for things we buy at Walmart and on Amazon, it said.

"US exports to China will suffer given slumping Chinese demand. China is supposed to ramp up its imports of US products as part of Phase One tre deal signed by two countries late last year.

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"How much Chinese would actually purchase from U.S. was alrey an open question. Given COVID-19, it is even more questionable. President Trump has suggested that federal government will cut ar check to hard-pressed US farmers to make up for losses," it said.

Because China is biggest buyer of many of world's commodities, including oil, copper, soybeans and pork, and will be buying a lot less of se and many or things, prices are slumping.

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Americans will pay less at gas pump, which is a plus, but it will be hard on energy, mining and agricultural industries. Emerging ecomies, especially in Latin America and Africa, that rely on commodity production for ir livelihoods will be slammed.

"Global businesses can't seem to catch a break. y have been grappling with tre war, Brexit transition, and ecomic policy implications of fast-approaching US presidential election," it said.

"COVID-19 is w ar on this lengning list of concerns, making it even more likely that alrey-cautious business executives will continue to sit on new investment and expansion plans. Moreover, y will likely be slow to ramp up ir operations, fearful of implications if y move too quickly and ir workers get sick," it said.

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