Allianz Global Wealth Report 2026

UK: Brexit uncertainty could jeopardize the recovery in H2

UK Q1 GDP fell by -2% q/q, in line with expectations. This release confirms that each week of lockdown cuts output by around -6%. Even before implementing a Covid-19 lockdown on 23 March, the UK economy was already on a weak footing, posting no growth in Q4 2019. And at the start of the year, advanced indicators pointed to below normal investment activities and trade as Brexit uncertainty was still looming.

Pensions: Corona reveals need for further pension reforms in Germany

The Corona pandemic renders the German government’s optimistic economic assumptions on which the forecast of the pension contribution rates and the benefit level until 2025 are based, obsolete. Due to short-time work and rising unemployment looms a shortfall of at least EUR 8bn. With pension cuts prohibited by law, an increase of the contribution rate can only be avoided by depleting the sustainability reserve faster than planned.

Global trade: COVID-19 losses equivalent to a return of 1994 tariffs

Global trade could remain below 90% of its pre-crisis level even after lockdowns are lifted and only recover gradually in H2 2020. We estimate that lockdowns and the uncoordinated deconfinement could cost merchandise trade USD2.4tn, the same as if all countries hiked their tariffs to 17%,  i.e. close to levels last seen in 1994.