The US has been called the main drag on the world economy

The US has been called the main drag on the world economy

POLITICS

2020-07-20 13:44:00

The United States can pull the complete world down, because the country's useless fight towards the coronavirus pandemic slows the global restoration, writes signal-means-profits.com.

Many countries rely upon the American financial system, so they may be scared of a deterioration of the situation inside the United States. "When America sneezes, the world catches a cold," the publication writes. The International Monetary Fund (IMF)  has identified social unrest as one of the main risks to economic growth. Rising American poverty levels could further weaken demand and slow the recovery. The US money owed for approximately 1 / 4 of the sector's GDP. Even the leading economies depend on the American market. For example, German exports to the US fell 36 percent year-on-year  in May additionally. Japan's recovery is also projected to drag on if the spread of the coronavirus in the US is not stopped, and exports from Asian countries do not grow.

The US government has despatched 3 trillion dollars to help the financial system, but those packages are approximately to run out. US GDP shrank via five percent within the first quarter of 2020, the largest drop for the reason that 2008 economic crisis.

In June, the US national debt reached 26 trillion dollars and set an absolute record. It grew by trillion dollars in a month. According to forecasts of the International Monetary Fund (IMF), it can boom to 131.1 percentage of GDP in 2020.

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