Trust

WHAT'S NEXT?: Trust in politicians and experts is falling fast. Privacy is under threat and may lead to a collapse of confidence in technology as the world is increasingly networked. Unless reliability, integrity, and surety can keep pace with accelerating change trust in anything but oneself may disappear.

• [New] The level of consumer confidence, the weak economic outlook as well as the resurgence in COVID-19 cases will contribute to the U.S. economy remaining in recession territory in the near term.
• [New] IATA downgraded its forecast for global passenger traffic and revenues, saying it will not return to last year's levels until 2024 because a COVID-19 resurgence in several countries, depressed corporate travel and weak consumer confidence is slowing growth more than expected.
• The global economy is forecast to expand by 5% in 2021 due to the easing of containment measures and a gradual recovery in consumer and business confidence.
• If Australia is hit by a significant second wave of coronavirus cases, that would postpone the economic recovery that many economists expect in the second half of 2020, unemployment would rise even further and consumer and business confidence would take a significant hit.
• Tax revenues are expected to further decline in FY2020 - 2021 due to the reduction in a number of taxes to stimulate economic activity, support tourism, restore consumer and business confidence and revive domestic demand.
• Excess reserves now held at the Fed are over US$ 3 trillion and the many Fed measures to restore confidence in the financial system since March have breathed air into the lungs of global risk markets.
• For 2021, ADB sees the Philippine economy bouncing back with a 6.5% growth, steady from April, on the back of state infrastructure spending as well as anticipated recovery in consumer and business confidence.
• Turkey's economy is expected to shrink by 3.8% in 2020, reflecting a continued fall in investment as confidence plummets to record lows, shrinking exports amid weak external demand, and the disruption to activity due to restrictive measures.
• India's oil supply is threatened by shifting energy geopolitics, and reliability is affected by frequent change in suppliers, which results in a lack of affordable and predictable energy supply and prices.
• Cybersecurity risk is the number one priority among senior management of global banks, and the data challenges, whether related to privacy, availability or integrity of data, are considered the biggest emerging risks in the coming years, greater than the risks associated with climate change.
• China has been seeking to shake off reliance on US dollar settlements that allow Washington to impose unilateral punitive sanctions on companies via the threat of exclusion from the SWIFT dollar settlement system.
• Activity is projected to pick up to 3% in 2021, as the impact of shocks related to the COVID-19 pandemic dissipates and tourism recovers alongside improving consumer and business confidence in Armenia and Georgia.
• In the Western Balkans, activity is expected to shrink by 3.2% in 2020, but to rebound by 4.6% in 2021, assuming that consumer and business confidence are restored as the impact of COVID-19 fades, and that political instability remains in check.
• The oil price environment now and potentially over the next few years marks a significant change from Moody's previous assumptions and creates downside risks for Saudi Arabia's already eroding fiscal strength due to the sovereign's still heavy reliance on oil revenues.
• The European Commission has emphasised Croatia's enormous level of reliance on tourism, which affects the depth of the expected decline this year, but also poses a risk in the case of longer travel restrictions.
• Due to the UK lockdown, regional market confidence has fallen sharply, and the majority of contributors now envisage a fall in workloads, new hiring and profit margins in the coming year.
• While interest rates are very low and will act to support prices, rising unemployment, slower wage growth and weak confidence will weigh on prices.
• Over the coming decades the UK will face many challenges and opportunities, including climate change, a growing reliance on electricity and digital, and widespread adoption of new technologies.
• Confidence among the leaders of the largest UK businesses has fallen sharply, with many expecting their revenues to decline by nearly a quarter this year.
• Saudi Aramco's plan to buy USD15 billion stake in Reliance Industries hydrocarbon business may not go through due to the rising risk of collapsing oil prices..
• Travel restrictions will cut global trade by up to $2.6 trillion, which is already reeling from trade tensions between the United States and China, a global growth slowdown and weaker business confidence.

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Last updated: 09 August 2020