Key points: Global

Supported by resolute fiscal and monetary policy measures, as well as greater control over the spread of the virus, global growth rebounded in the third quarter and is expected to continue doing so in the fourth quarter, albeit at a slower rate as the number of infections remains very high.

Recovery of activity is expected to gain momentum in 2021. The expected approval and distribution of effective vaccines and treatments against COVID 19 will likely allow for a progressive relaxation of social distancing measures over the next year, firstly in the major world economies and then in the rest.

Key points: Spain

The forecast for an 11.5% contraction in GDP during 2020 remains . Although the reduction in activity exceeded 20% in the first half of the year, it is estimated that the recovery in the third quarter would have been 14% q/q. In any case, a significant moderation of growth is expected during the latter part of 2020.

The GDP growth forecast for 2021 is revised downward by 1 percentage point (pp) to 6% as a result of deteriorating health conditions in both Spain and the EMU, and the effects of demand policies may be beginning to weaken. In the most likely scenario, this can only be partially offset by the initial push of the Recovery, Transformation and Resilience Plan of the Spanish Economy, which could add about 1 pp to GDP growth in the following year and 2 pp in 2022.

Although the balance of risks remains negative, more positive scenarios cannot be ruled out as a result of the NGEU. Reaching an agreement on the adoption of measures that may advance the impact of resources from Europe and that maximize their effect through the necessary reforms is particularly important.

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