{"id":542250,"date":"2021-11-29T08:55:22","date_gmt":"2021-11-29T06:55:22","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=542250"},"modified":"2021-11-29T08:55:22","modified_gmt":"2021-11-29T06:55:22","slug":"4-scenarios-for-the-new-omicron-covid-variant-and-what-it-will-mean-for-the-economy","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/business-opinion\/542250\/4-scenarios-for-the-new-omicron-covid-variant-and-what-it-will-mean-for-the-economy\/","title":{"rendered":"4 scenarios for the new Omicron Covid variant &#8211; and what it will mean for the economy"},"content":{"rendered":"<p>Goldman Sachs economists set out four scenarios for the potential impact on global economic growth from a new coronavirus variant, while adding that it\u2019s too early to adjust their forecasts given it still isn\u2019t clear which is likely to transpire.<\/p>\n<ul>\n<li><strong>Downside Scenario:<\/strong> Omicron transmits faster than predecessor, delta. This results in first-quarter global growth slowing to a 2% quarter-on-quarter annual rate, or roughly 2.5 percentage points below Goldman\u2019s current forecast. For 2022 as a whole, the global economy still expands by 4.2%, or 0.4 percentage points below current forecast, while the inflation outlook is \u201cambiguous\u201d<\/li>\n<\/ul>\n<ul>\n<li><strong>Severe Downside:<\/strong> Both the disease severity and immunity against hospitalizations are substantially worse than for delta. Global economic growth takes a more substantial hit, while \u201cthe inflation impact is again ambiguous\u201d<\/li>\n<\/ul>\n<ul>\n<li><strong>False Alarm:<\/strong> Omicron spreads slower than delta and has no significant effect on global growth and inflation; and<\/li>\n<\/ul>\n<ul>\n<li><strong>Upside:<\/strong> Omicron is slightly more transmissible, but causes much less severe disease. In this speculative \u201cnormalization\u201d scenario, a net reduction in disease burden leaves global growth higher than Goldman\u2019s baseline. Inflation is likely lower as the rebalancing of demand, and the recovery in goods and labor supply accelerate<\/li>\n<\/ul>\n<p>&#8220;The upshot is that omicron could have sizable growth effects, but that the range of medical and therefore economic outcomes remains unusually wide,&#8221; Goldman economists led by Jan Hatzius said in a research note.<\/p>\n<p>&#8220;Given this and the possibility of a \u2018false alarm,\u2019 we are not making omicron-related changes to our growth, inflation, and monetary policy forecasts until the likelihood of these scenarios has become somewhat clearer,&#8221; they said.<\/p>\n<p>What comes next is likely be dictated by what scientists discover about the new Covid-19 variant, including how resistant it is to vaccines and how much more transmissible it is than the delta variant, which raged in recent months without sending economies back toward recessions.<\/p>\n<hr \/>\n<p><strong>Read:<a href=\"https:\/\/businesstech.co.za\/news\/business\/542186\/the-areas-services-and-businesses-that-could-require-mandatory-vaccines-in-south-africa\/\" target=\"_blank\" rel=\"noopener\"> The areas, services and businesses that could require mandatory vaccines in South Africa<\/a><\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Goldman Sachs economists set out four scenarios for the potential impact on global economic growth from a new coronavirus variant, while adding that it\u2019s too early to adjust their forecasts given it still isn\u2019t clear which is likely to transpire.<\/p>\n","protected":false},"author":59,"featured_media":531300,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[6603,26],"class_list":["post-542250","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-business-opinion","tag-goldman","tag-headline"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/542250","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/59"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=542250"}],"version-history":[{"count":3,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/542250\/revisions"}],"predecessor-version":[{"id":542262,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/542250\/revisions\/542262"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/531300"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=542250"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=542250"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=542250"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}