November 02, 2020
Please download the latest chart book, Ruff going for GDP: What can be seen from the latest data?
KPMG’s Office of the Chief Economist is continuously monitoring key developments in this unprecedented situation and refinements to the economic model occur daily. To learn about our current scenario analysis, including deep background on the underlying cause and effect dynamics, please download our latest report, Ruff going for GDP: What can be seen from the latest data?
- The pandemic is both a supply shock and a demand shock with the demand shock dominating economic activity.
- The demand shock has adversely impacted services consumption in Q3 due largely to Fear of Going Out (FOGO) inhibiting the demand for in-person activities at the same scale as prior to the pandemic.
- The demand shock has positively impacted goods consumption in Q3, due largely to FOGO increasing the demand for home improvements as well as fiscal assistance that boosted consumption of big ticket items such as autos.
- The demand for goods is unlikely to be sustained at the Q3 pace while the demand for services is at risk in the U.S. and Europe as the number of virus cases and deaths continue to rise.
- An additional fiscal stimulus is needed to shore up the firewall around the COVID impacted parts of the economy.
Due to the rapidly evolving nature of this situation, we update this analysis frequently. Please check back often for our latest report.