UK-Australian resources firm BHP said global economic recovery from Covid-19 will vary. Demand for raw materials in China has strengthened in recent weeks, but it is expected to contract sharply in the US, Europe and India because of the impact of the virus.
Economies including India, China, and the US will contract heavily in the April-June quarter, while China has moved from intensive viral suppression to early indications of economic recovery. Spurred on by supportive credit and fiscal policy, Chinese domestic industrial activity has been improving.
Around 30 percent of BHP's annual sales come from exports to China. BHP is one of the world's largest exporters of iron ore and hard cooking coal.
Negative impacts will be seen by South Korea, India, and Japan on industrial activity from their suppression efforts and those of their trading partners. It is still uncertain whether traditional monetary and fiscal stimulus policies will have below-average or above-average multiplier effects, BHP said. A lower multiplier could result from depressed consumer and business confidence because of the damaging impact of Covid-19 on both jobs and profitability.
