Posts From Nemanja Popovic
Currencies: Is the Dollar in Danger?
Recent declines in the dollar have once again raised questions about its status as the de facto global reserve currency. But the current depreciation in the greenback is more the result of a perfect short-term storm, as opposed to a permanent global retreat from the dollar.
Serbia: Robust Q1 Performance Unlikely to Continue
The Serbian economy performed well during the first quarter of 2020. Structural factors, such as a smaller dependence on tourism, as well as effective fiscal and monetary responses, have significantly alleviated contractionary pressures. However, guiding the economy throughout the rest of the year will be a more laborious endeavour.
US: Inflationary pressures are highly unlikely
As a response to the Covid-19 outbreak, the United States unveiled a $2 trillion package in March – the largest of its kind. Aside from the expansion of debt, potential inflation has been a cause for concern. But several factors ensure that broad inflationary pressures will almost certainly be absent during the lockdown, and, likely, in the immediate period after.
Price War: OPEC+
After OPEC ally Russia refused to cut production, Saudi Arabia launched a price war, sending global oil prices to as low as $32 a barrel on March 9th.
Coronavirus: Threats to Global Economy
Aside from the obvious humanitarian costs associated with the coronavirus outbreak, it will inflict a severe economic toll. Given the structure of international supply chains, a Chinese slowdown affects the rest of the world. But this may no longer be a Chinese problem, as the recent surge in cases in Italy threatens the Eurozone economy directly. Global growth may have to take a temporary backseat until the crisis is resolved.
