10/13/2020, 2:30 PM (Source: TeleTrader)
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OPEC lowers 2021 world growth forecast to 4.6%

The Organization of the Petroleum Exporting Countries (OPEC) revised down the world's economic growth forecast for 2021 to 4.6% in its latest Monthly Oil Market Report. For 2020, the OPEC's global growth forecast remained at minus 4.1%. Out of all major economies worldwide, the report noted that China would be the only country to see growth this year (2%). The Eurozone will face the biggest contraction, a significant 7.7%. However, economic rebound across the globe is expected to happen in 2021.

"Those countries that rely relatively more on the services sector, especially on the contact-intensive sub-sectors of travel and transportation, tourism, hospitality and leisure will most likely face ongoing challenges in 2021," the report noted. Even if a COVID-19 vaccine is soon created, the global economy will continue to adapt to a "new normal" by making structural changes ranging from supply chain alterations to a rise in digitalization and home-office bound working, as well as less business-related travel.

As debt levels rise both worldwide and in the United States, the coronavirus crisis will create the potential for a further softening impact on the value of the American dollar. The OPEC stressed that uncertainties such as the US presidential elections and the Brexit could change the near-term trajectory. On the other hand, it asserted that no nationwide lockdowns would be imposed in any of the leading economies in expectation of a coronavirus vaccine which, according to the OPEC, will be available by the second half of 2021.

Breaking the News / ND