Economy and second wave: they believe the new restrictions could reverse the rebound of the first months of the year

The new “intermittent” restrictions on the activity of the various productive sectors that the government put in place in May in the middle of the second wave of coronavirus infections could reverse much of the rebounding trend in the economy in the early months of the year.

This is what a report from the study center says Ieral, who felt that “if June looks like May in terms of restrictions, then the second quarter could record a drop in GDP of nearly 2.5% compared to the first», Published in a report written by Jorge Vasconcelos and Guadalupe González. In this way, this figure would cancel out “a good part of the rebound in the level of activity verified in early 2021. Thus, in June of this year, the GDP would return to levels similar to those of the fourth quarter of 2020 ″, projected this study center.

“The return of stricter measures for the movement of people and the functioning of businesses and businesses, which came into force between the 22nd and the 30th of last month, will have an impact on the trajectory of the level of activity, although preliminary data for May predict that the drag will be less intense than that experienced in March 2020, when the GDP fell by 10.5% compared to February, ”Ieral anticipated.

“In case June looks like May in terms of restrictions, then the second quarter could see a GDP decline of almost 2.5% from the first.” (Ieral)

In this sense, however, he warned that “for the assessment of the impact of the new wave of Covid on the level of activity, it will be necessary to travel these weeks of June, to verify that the restriction measures maintain the characteristic of the last month and maybe avoid stricter regulation, ”he concluded.

Some initial data suggests to Ieral that there may be some cooling in activity for this reason. “The available data are partial and do not involve all the variables, but Electricity consumption (non-residential) can be estimated to have decreased by 2.1% in May in seasonally adjusted terms compared to April”The report mentioned.

And he went on to list: “Labor mobility measured through Local Mobility Reports on Covid-19 published by Google suffered a decline in May of around 6 percentage points compared to April , while the collection of taxes related to the domestic market fell 5.3% in constant currencies in May compared to April, after falling 1.6% that month compared to March. In all three variables, monthly data is calculated, and not just what happened in the latter part of May when the falls were much more intense.», Concluded the report.

For the director of Analytica, Ricardo Delgado, For its part, “We have already seen that data from April started to indicate that the rebound that occurred from November to March has already ended.“he said before Infobae. “We have two very strong indicators, a drop in wholesale demand for electricity of 3 percentage points and a drop in imports of almost 10%, as well as some data such as the consumption of credit cards”, a- he mentioned.

“From May, the new restrictions began with intermittent closures. This will probably have an impact above all on the service sectors, mainly commerce, hotels or tourism. All these sectors represent 60% of the GDP ”(Delgado)

“This is a number of relevant indicators, which are not yet seen in the collection as it is strongly impacted by the holdings, which indicate that in a certain way that the initial rebound would have been at least very moderate, if not concludedsaid Delgado.

In this sense, the economist said that “from May the new restrictions with intermittent shutdowns started. This will probably have an impact above all on the service sectors, mainly commerce, hotels or tourism. All these sectors represent 60% of the GDP approximately, the rest are commodities, ”he said. And in this regard, he specified that “these quarantines by impacting on traffic impact on services, which are also the most job-seeking sectors and in particular those with low qualifications,” he explained.

“In the future, it will depend fundamentally on whether we can speed up vaccination as much as possible. It is the main short-term tool of the Government’s economic policy, because as long as you can vaccinate, you will have to restrict less. From there, you can reconsider a process of growth which, until the data for April, which we have already consolidated enough, showed some rather worrying signs of having remained at a standstill, ”he said. he concludes.

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