A pre-requisite for good macroeconomic policymaking is timely information on the current state of the economy, particularly when economic activity is changing rapidly. Given that GDP is usually only available on a quarterly basis (with first estimates typically published four weeks or later after the end of the quarter), policymakers and forecasters have long made use of more timely higher frequency data, such as survey‑based indicators like Purchasing Managers’ Indices (PMIs). However, both the current crisis and the earlier ones have shown that the underlying relationship with survey‑based indicators can become unreliable when changes in economic activity are abrupt and massive (Vermeulen, 2012).This problem has prompted a search for alternative high‑frequency indicators of economic activity. This issue note discusses one such indicator based on Google Trends, which are used to construct a Weekly Tracker that provides real-time estimates of GDP growth in 46 economies covering G20, OECD and OECD partner countries.

This note investigates the likelihood of corporate insolvency and the potential implications of debt overhang for non-financial corporations associated with the Coronavirus (COVID-19) outbreak. Based on simple accounting exercises, it evaluates the extent to which firms may deplete their equity buffers and increase their leverage ratios in the course of the crisis. Next, relying on regression analysis and looking at the historical relationship between firms’ leverage and investment, it examines the potential impact of higher debt levels on investment during the recovery. Against this background, the note outlines a number of policy options to flatten the curve of crisis-related insolvencies, which could potentially affect otherwise viable firms, and to lessen the risk of debt-overhang, which could otherwise slow down the speed of recovery.

Several central banks in advanced economies have embarked on monetary policy reviews in the context of persistently low inflation, interest rates and potential GDP growth in past decades and increasing use of unconventional tools since the global financial crisis. These reviews are welcome as they allow central banks to rethink openly their targets, tools and communication in the context of a changing economic environment. The engagement with the public on these issues can strengthen their legitimacy and credibility.

Recent optimistic news about the availability of a number of vaccines against the coronavirus needs to be tempered by the realisation that, even in the countries that are in the vanguard, it is likely to be the middle of next year before a large share of the population has been vaccinated. In the meantime, governments around the world are trying to calibrate policy interventions so as to keep the spread of the disease under control without crippling economic activity, in many cases with limited success as virus transmission has recently picked up again in several countries. This study uses country experience during the first phase of the pandemic to estimate the impact of different government interventions on both the reproduction rate of the virus, R, and on mobility, as a proxy for economic activity. The empirical results then inform a number of scenarios where the epidemic/economic trade-off of different policy packages is assessed. Further details of the estimation methodology, results and underlying data can be found in OECD (2020).