In its first estimate since European countries introduced lockdown measures to stop the spread of the coronavirus, the European Commission, the executive arm of the EU, forecast on Wednesday that the eurozone economy will contract by 7.75 per cent this year. That would be the worst economic shock to the region since the Great Depression in the 1930s.

However, the Commission expects the currency bloc to return to growth of 6.25 per cent next year. The eurozone unemployment rate is forecast to climb to 9.5 per cent this year from 7.5 per cent in 2019.

The EU and member states have already agreed on extraordinary measures to mitigate the impact of the COVID-19 pandemic and the collective recovery will depend on continued strong and coordinated responses at EU and national level, a top EU official said.

Meanwhile, US private sector employment nosedived in the month of April, according to a report released by payroll processor ADP.

The report said that non-farm private sector employment plummeted by 20,236 million jobs in April, easily surpassing the previous record of about 835,000 in February 2009 at the height of the global financial crisis.

The report probably understates the actual damage done during the implementation of social distancing measures. ADP pointed out that the report utilises data through the 12th of the month and does not reflect the full impact of coronavirus-induced shutdowns on the overall employment situation.

Finally, China’s exports expanded in April despite bleak global demand, data from the General Administration of Customs revealed on Thursday. In dollar terms, exports grew by 3.5 per cent on a yearly basis in April, confounding economists’ expectations that called for a decline of 12.1 per cent. Shipments had declined by 6.6 per cent in March.

Meanwhile, imports sank by 14.2 per cent compared to last year versus the expected fall of 12.4 per cent and March’s 0.9 per cent drop. Consequently, the trade balance showed a surplus of $45.34 billion in April, which was well above economists’ forecast of $9.7 billion and sharply up from $19.9 billion in March.

This report is compiled by Bank of Valletta for general information purposes only.