Global lockdowns intensify economic damage

Via Goldman:

  • Our global GS Effective Lockdown Index (ELI) – a combination of official restrictions and actual mobility data from 46 economies, weighted by PPP GDP – tightened in the third week of January.
  • Using our estimated relationship between the GS ELI and real activity, we see an ELI-implied hit of nearly 10% ELI-implied hit to the level of global GDP in the third week of January versus a peak 20% hit in mid-April last year. However, the actual impact is likely smaller than estimated using the historical ELI-GDP relationship, due to a potential decline in the sensitivity of consumer and firm behavior to policy restrictions.
David Llewellyn-Smith
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