COVID-19: Central Banking a COVID-19 Economy

The novel strain of coronavirus – Covid19 needs no further introduction as it continues to dominate newspaper frontpages, television breaking news stories, and boardroom deliberations. The impact of the Covid19 pandemic on economies is global, while targeted efforts remain geared at immediately reducing the menace of the virus and eventually defeating the pandemic.

One frontline approach to dealing with Covid19, and halting its spread, is to restrict movement and gathering of people: essentially, social distancing. Several countries and even more constituent units within countries have, effectively, gone into lockdown. Current estimates are that 1/3 of the World’s population is currently in lockdown.

The current restrictions and lockdown measures aimed at defeating the spread of the pandemic have led to a significant strain on the economy. To explain simply: economies rely on trade; trade relies on the movement of goods, services, and capital. Where goods, services, and capital are unable to move – economies suffer.

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