Will coronavirus fuel a short recession?

By Matt High
Investors have been urged to take action against the growing risk of a global recession due to coronavirus Nigel Greene, the CEO of deVere Group, one o...

Investors have been urged to take action against the growing risk of a global recession due to coronavirus

Nigel Greene, the CEO of deVere Group, one of the world's largest financial advisory organisations, has warned investors to take steps now to build and protect their wealth against the growing risk of a coronavirus-driven short, sharp global recession. 

Greene's warning comes as confirmed cases of coronavirus continue to rise globally and, at the same time, governments and central banks around the world are taking increasingly aggressive measures to try and combat the economic impact of the outbreak.

These include, on 5 March, the US Federal Reserve announcing that is intends to cut interest rates by half a percentage point.

The Bank of England is drafting an action plan to deliver a "powerful and timely" response to the coronavirus. On 4 March it was reported by The Guardian that the Bank of England's incoming governor, Andrew Bailey, called on the government to consider emergency financial support to British companies suffering as a result of coronavirus.

Bailey also warned that there was limited room for the central bank to cut interest rates, and was quoted as saying: "We are collectively now going to have to provide some form of supply chain finance in the not too distant future."

Economic fallout

In his recent warning, Greene said that the outbreak of coronavirus is developiing and evolving quickly, and that "no one accurately can predict what will be the economic fallout". 

However, he added, "I believe that based on what we currently know, the risk of a coronavirus-driven short, sharp global recession this year is significantly growing. The epidemic has already dented anaemic global economic growth this year and it can be expected to slow further, then contract, as the fear of the virus takes hold.”

Greene explained that the outbreak of coronavirus had already sent the stock market "into bouts of volatility not seen since the 2008 financial crisis, severely disrupted global supply chains, shuttered factories, grounded flights, closed attractions and cancelled major events."



For more information on all topics for FinTech, please take a look at the latest edition of FinTech magazine.

Follow us on LinkedIn and Twitter.



Featured Articles

Has the ‘gamification’ of investing apps gone too far?

In order to attract new customers into the fold, investing apps are trying to make their platforms engaging – but has this led to a problematic culture?

Top 10 Digital Reports & Consultancies for the fintech space

In the fintech industry, knowledge is power. We’ve rounded up the top 10 financial reports and consultancies for fintech leaders to follow

Analysis: China's civil unrest & the long-term economic view

As Shanghai’s stock market tumbles, we explore the impact, reasons, and long-term consequences of China’s civil unrest

SIX fintech sectors transforming the financial industry

Financial Services (FinServ)

Luvleen Sidhu on founding and leading BM Technologies


Top 10 Digital Banks of 2022