If the coronavirus doesn’t make you physically ill, it could be affecting your financial health as more reports begin to surface on the economic impact of the outbreak.
The Wall Street Journal reports on the array of companies outside of China that are having to slow production or rapidly seek alternative sources as the near pandemic is affecting the supply chain of Chinese products with factories there slowing or shutting down because of the number of ill workers.
Meanwhile, Bloomberg reports White House trade advisor Peter Navarro as saying the virus has demonstrated that too much of the US supply chain has been moved offshore.
“A lot of it is in China, some of it is in India, some in Europe, but we’ve got to get that back on shore… people need to understand in crises like this, we have no allies,” Navarro told the news service, citing the 2009 swine flu outbreak and US allies that would not fill in supply gaps.
“This administration is moving as rapidly as possible in my part of the portfolio to make sure our supply chain is secure and we have what we need,” Navarro said.
The fear of further spread led to a steep selloff in US stocks, with the three major US stock indices – the Dow Jones Industrial Average, S&P 500 and Nasdaq Composite – all losing about 3.5% of value in a single day, according to Reuters.
The AP reports: “Investors looking for safe harbours bid up prices for US government bonds and gold. The yield on the 10-year Treasury note fell sharply, to 1.37% from 1.47% late Friday. It was at 1.90% at the start of the year.”
“China’s economy has already been hamstrung by the outbreak, which has infected more than 77,000 people there and triggered quarantines that have closed factories,” The New York Times reports, adding that the virus’s continued spread has created fears that “the outbreak is reaching the point where it will drag on growth, including in the United States, where until now analysts had only whittled around the edges of expectations.”
The Times reports economists at Goldman Sachs, “who were expecting first-quarter domestic growth of 2% as recently as late January, have been steadily lowering their estimate, which fell to 1.2% on Monday.”
Boat shows throughout Asia and nearby locales have been postponed or cancelled as a result of coronavirus.