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Limitations, the impact of Omicron on policy support: Moody’s

According to Moody’s Investors, the economic impact of the new omicron variant of the new coronavirus on emerging economies will be government regulation, public comfort to social interactions, and government and central bank additions to the private sector. It depends on the combination of capacities to provide policy support. Services that pose new risks to global economic growth and inflation outlook.

Recently, some countries have imposed new travel bans, and they are likely to increase in the coming weeks until scientists learn more about the variant, he said.

Continued progress in global vaccination efforts and public compliance with the use of tools such as masks and social distance will be important factors in determining the economic impact of new variants. .. “Countries with a guaranteed supply of effective vaccines and delivery systems and high public acceptance of vaccines will continue to be in a good position,” Moody’s said in a news agency.

The impact of Omicron variants on emerging economies depends on a combination of government regulation, public comfort for social interaction, and the ability of governments and central banks to provide additional policy support to the private sector, Moody’s. Investors Services said: Global economic growth and inflation outlook.

A US-based rating agency said European countries such as the United Kingdom, Germany, France, the Netherlands and Belgium have detected cases of Omicron and are urging them to curb new travel. In addition, the restrictions imposed following the recent increase in delta infections may be further extended and extended.

China’s Zero Tolerance COVID-19 policy will further delay the relaxation of rules surrounding overseas travel in the face of Omicron variants. Authorities said it was likely to increase regulatory rigor if the variant was found domestically.

“Economic impacts on other emerging market countries are different, of government regulation, public comfort to social interactions, and the ability of governments and central banks to provide additional policy support to the private sector as needed. It depends on the combination. Emerging market countries facing travel bans, including South Africa, and countries that rely on tourism revenue, face further downside risks, “Moody’s said in a report.

According to Moody’s, the emergence of new varieties will also occur during periods of fragile economic recovery, such as supply chain expansion, rising inflation and labor market shortages. Business disruptions resulting from the proliferation of new variants can relieve supply chain stress, reduce capacity and prevent further cost pressure on sectors exposed to the global supply chain.

On the demand side, the risk of infection can prevent most individuals from engaging in economic activities that require close contact. Therefore, rating agencies may add that demand for services ranging from hospitality to travel may decline during periods of normal holiday-related spending.

Fiber2Fashion News Desk (DS)



Limitations, the impact of Omicron on policy support: Moody’s

Source link Limitations, the impact of Omicron on policy support: Moody’s

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