Coronavirus and Italy’s vulnerability
We leverage data from the Italian statistics office (ISTAT) at a regional and provincial level to put the possible impact of the virus outbreak on economic growth into perspective. With considerable uncertainty about how long the crisis will last, as of now, a zero-growth scenario this year already seems on the cards.
The repricing of credit risk
Markets are now questioning the assumption of world growth stabilization. Before the sell-off, corporate debt market was driven by
liquidity/search for yields without worrying about fundamentals: huge inflows, very active primary market, and tight valuation. This risk-off market moves could penalize global growth, especially given how late we are in the cycle.