Heterogeneity, volatility and uncertainty

The game and the rules remain the same, but the pieces are starting to move in new directions, causing the situation to change. In relation to the health crisis, the pace of vaccination has become the main determinant of how much and when economies will recover this year. Meanwhile, on the other side of the board, governments have been calibrating fiscal and monetary stimulus measures, as activity gradually returns to pre-pandemic lev- els, although more vigorously in some sectors than in others. In particular, there is growing concern about higher inflation, which is putting pressure on interest rates, the cost of public and corporate financing and the prices of financial assets.

Heterogeneity between countries, the first and second halves of the year and sectors will be a strong feature of the evolution of the world economy in 2021.

Asian countries, which have suffered comparatively less from the pandemic, and advanced western econo- mies, notably the United Kingdom and United States, which are advancing more rapidly in vaccination, will drive global growth in 2021. Meanwhile, emerging Latin American economies are expected to continue to perform relatively weakly.

The beginning of this year, in particular, has been marked by intense heterogeneity in the performance of economic activity between countries, together with great uncertainty in relation to the fight against the pandemic, resulting in a more volatile global environment. The pandemic has worsened in some countries, as new strains of the virus have appeared, leading to the reintroduction of restrictive measures. In Europe, countries such as the United Kingdom, which remains in lockdown, and Germany, which has extended its restrictive measures until March, are likely to see a drop in GDP in the first quarter of 2021.

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