June 22nd, 2020
Even though most investors have already written off Q2 for the global economy, encouraging signs of a rebound have been building as we enter the final month of the quarter. Despite regional variations, Citi's G10 'economic surprise' index has effectively stopped surprising to the downside for the first time since March - showing a better balance between what markets assume to be the state of economies and reality revealed by hard data. Tuesday's release of flash purchasing managers' surveys for June will test the tentative rebound in sentiment seen last month. Markets, who have been tracking high frequency activity indicators back above 50% of pre-pandemic levels in recent weeks, will now have to weigh this recovery against the risks posed by persistent clusters of the COVID-19 virus in parts of economies such as the United States, China, Germany and South Korea.
Chart by Ritvik Carvalho and commentary by Mike Dolan
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