The COVID-19 pandemic continues to worsen and now stands at 1,446,242 cases worldwide – a near doubling last week’s total. According to data compiled by John Hopkins University, countries with the largest outbreaks are as follows: the United States (399,929 cases), Spain (146,690), Italy (135,586), France (110,070),  Germany (107,663), China (82,809), Iran (67,286), and the United Kingdom (55,957). There have now been over 83,149 deaths recorded worldwide.

The situation has yet to stabilize in the United States, though there are some encouraging signs that a peak might be on the horizon. Most recently, the rate of new hospitalizations slowed in New York – the epicenter of the US outbreak. Yet the state also reported its highest one-day death total since the outbreak began with 731. It was joined by New Jersey in reaching the grim new milestone; that state saw 232 people die over the past 24 hours. Together, the two account for the vast majority of US fatalities from COVID-19.

More positive news can be found in Europe, where countries like Denmark and Czech are seeking to partially relax lockdown conditions. Even hard-hit states like Spain, France, and Italy are now seeing death rates decline from their March peaks.

Here are some of the significant economic developments from the past week:

• Some of the first official data has emerged from the heart of COVID-hit Europe, and the news is predictably horrible. The German economy, already faced with the prospect of a recession before the COVID-19 outbreak, is expected to shrink by 10% over the second quarter. That would represent the steepest decline on record, and would be nearly twice the decline of the worst quarter of the Great Recession. It could translate into a 4.2% contraction over the course of the year according to data from the Ifo Institute for Economic Research.
• The outlook is similarly bad in France, where the central bank is predicting a 6% contraction over the first quarter (Q4 2019 saw a contraction of 0.1%). This is a remarkably awful result considering it’s for the first quarter, which was only partially impacted by COVID-related shutdowns (by contrast, the German economy shrank by 1.9% over the same period). It’s safe to say that the second quarter data will be considerably worse; according to the Banque de France, the pandemic is shaving5% off of French growth every two weeks it goes on.
• One recent government estimate put Saudi Arabia’s 2020 budget deficit at 9%, up from the 6.4% that was previously forecasted. Given the likely severity of the COVID-19 fallout and the OPEC-Russia price war, this can be considered an exceedingly conservative estimate. The Kingdom’s debt-to-GDP ratio has been creeping up of late and was expected to reach 26% by the end of the year (pre-COVID). Newer estimates suggest that the COVID fallout and resulting stimulus spending could spike overall debt to 50% of GDP in the years ahead.
• April 7 has come and gone, and with it a summit of euro zone financial ministers that was supposed to shore up the bloc’s fiscal response to COVID-19. Ministers debated for over 16 hours, but were unable to bridge the fundamental divide (explained in greater depth in last week’s report). Another meeting is scheduled for Thursday, but in the meantime, bond yields have been spiking in Italy and Spanish officials have been warning that the future of the bloc hangs in the balance.