pimco

Is this health crisis turned economic shock the ESG inflection point that markets needed? In this Q&A, we discuss the outlook for ESG and PIMCO’s approach to sustainable investing.

Fund shrank from $2.9bn to $877m

The coronavirus pandemic has brought about a new investment landscape in which some companies and sectors have fared better than others. Significant market dislocations have also created potential opportunities in the higher quality areas of the credit spectrum.

While a near-term mechanical bounce in economic activity in response to the lifting or easing of lockdown measures looks likely, we expect the subsequent climb up to be long and arduous.

We expect the global economy and financial markets to transition from intense near-term pain to gradual healing over the next six to 12 months. However, there is the risk if not the likelihood of an uneven recovery, with significant setbacks along the way and some permanent damage.

Governments and central banks have started to respond more forcefully to the health crisis, enacting policy in an effort to limit long-term damage to the global economy.

Global growth could follow a U-shaped path over the next few quarters, though substantial uncertainty remains as policymakers grapple with the impact of the coronavirus.

'Excellent growth opportunity'

History teaches that epidemics tend to have short-term effects on economies and markets, but great uncertainty remains about the coronavirus.

Deadline for ISA allowance approaching