The COVID‑19 outbreak has been relatively contained so far and the lockdown started to be gradually lifted in mid-April. GDP is projected to contract by 6.2% in 2020 if there are no further virus outbreaks (the single‑hit scenario), and by over 7% if there is a renewed outbreak later this year (the double‑hit scenario). Economic activity will pick up as confinement measures ease, but the economic recovery will nevertheless take time, with output still below its pre-crisis level by the end of 2021. Unemployment, and the number of people on short-time work schemes, has soared and is projected to remain high through the projection period. Given additional spending as part of the policy response and weaker tax revenues, a large government budget deficit will open up. The comparatively low rate of inflation is expected to slow in the near term, picking up somewhat in 2021.