JUNE 13 — In December last year we presented our scenario analysis for 2021 in which we predicted a “survival trap” period where consumers, firms and the government ran down their reserves, followed by a “tipping point,” around now where the economy faced a 50 per cent chance of a weak recovery or a 30 per cent chance of a mild recession.
Our recent update based on new economic data and the impact of various lockdowns suggests that a recessionary scenario is more likely at around 35 per cent.
We have also raised the likelihood of a weak recovery to 55 per cent. The strong rebound hoped for by the government is all but gone with only a five per cent chance and we put the same odds on a full-scale slump.
Our general scenarios are shared by many independent…
