Goldman Sachs sees 1% drop in global GDP due to 'coronacrisis'

[March 23, 2020]    LONDON (Reuters) - Goldman Sachs said it expected global real gross domestic product to contract by about 1% in 2020, a sharper economic decline than in the year following the 2008 global financial crisis.

An aerial photo shows the Seoul Express container ship docked at Harbor Island at the Port of Seattle in Seattle, Washington, U.S. March 21, 2019. REUTERS/Lindsey Wasson/File Photo

Global governments have been taking unprecedented measures to contain the coronavirus outbreak which is threatening to spark a worldwide economic contraction.

"The coronacrisis — or more precisely, the response to that crisis — represents a physical (as opposed to financial) constraint on economic activity that is unprecedented in postwar history," the investment bank said in a note to its clients published late on Sunday.

It sees the real GDP in advanced economies contracting "very sharply" in the second quarter, including a 24% drop in the United States, a whopping two-and-a-half times as large as the previous postwar record.

(Reporting by Thyagaraju Adinarayan, editing by Karin Strohecker)

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