OECD Economic Outlook, Volume 2020 Issue 1
The OECD Economic Outlook is the OECD's twice-yearly analysis of the major economic trends and prospects for the next two years. The Outlook puts forward a consistent set of projections for output, employment, prices, fiscal and current account balances.
Coverage is provided for all OECD member countries as well as for selected non-member countries. This issue includes a general assessment of the macroeconomic situation, a series of notes on the macroeconomic and structural policy issues related to the COVID-19 outbreak and a chapter summarising developments and providing projections for each individual country.
Luxembourg
The COVID-19 pandemic has led to a sharp contraction of the economy. If the virus subsides by the summer (the single-hit scenario), GDP is projected to shrink by 6.5% in 2020, as a consequence of measures put in place to contain the spread of the COVID-19 pandemic, and then recover by 3.9% in 2021. If there is a new virus outbreak later this year (the double-hit scenario), GDP would drop by 7.7% in 2020 and rebound by only 0.2% in 2021. In both scenarios, the recovery will be supported by domestic demand and, to a lesser extent, by exports. The unemployment rate would reach a level close to 8.6% in 2021 in the double-hit scenario and 7.5% in the single-hit scenario.
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