Retail Savings and Investments in Belgium - COVID-19 Impact Snapshot

Retail Savings and Investments in Belgium - COVID-19 Impact Snapshot

Summary

The Coronavirus (SARS-CoV-2) outbreak, dubbed COVID-19, is first and foremost a human tragedy, affecting millions of people globally. The contagious Coronavirus, which broke out at the close of 2019, has led to a medical emergency across the world, with the World Health Organization officially declaring the novel Coronavirus a pandemic on March 11, 2020.

Fears surrounding the impact of COVID-19 have already significantly impacted the global economy, with most countries across the world registering dramatic declines in economic activity year-to-date. Many economists and institutions have cut their forecasts, as a number of countries have officially slipped into recession in Q1 2020.

A similar trend is expected in Belgium. As economic growth in the country dipped in the first quarter of the year, we expect the country to enter recession in Q2 2020. The decline had a significant impact on all sectors, including retail savings and investments. While Belgium, despite being one of the worst affected European countries, is now on the path to recovery with fewer active cases being reported and businesses gradually recommencing operations, retail savings are forecast to decline throughout the year.

This report focuses on the impact of the Coronavirus outbreak on the Belgian economy and the country’s retail savings and investment market. It also highlights the measures adopted by the government to combat COVID-19. Based on our proprietary datasets, the snap shot contrasts GlobalData’s pre-COVID-19 forecasts and revised forecasts of total retail bond, deposits, equities and mutual funds holdings in terms of value and growth rates. It also analyses the effects on HNW wealth, examining the importance of different industries as a contributor to HNW wealth.

Scope

- Belgian retail savings and investments are forecast to contract by 0.8% over the course of 2020, as the economy has almost come to a complete standstill thanks to the impacts of COVID-19.
- While the BEL 20 index recorded positive growth in early April on the back of a slowing infection rate in Belgium and the wider region, we expect volatility to persist as uncertainty surrounding the success of lockdown measures being loosened remains. Retail equity and mutual fund holdings are expected to take the brunt of the economy’s slowdown, with respective declines of 21.6% and 12.4% anticipated.
- The decline in mutual fund holdings is forecast to be less pronounced due to the relatively low exposure to equities, with equity funds accounting for a quarter of total funds.
- On the other hand, retail deposits and bond holdings are set to fare better than initially expected, courtesy of a flight to safety away from risk assets.
- However, more pronounced declines in risk asset holdings mean that GlobalData’s total retail holdings forecast for 2020 is 2.8 percentage points (pp) lower than before the onset of COVID-19.

Reasons to Buy

- Make strategic decisions using top-level revised forecast data on the Belgian retail savings and investments industry.
- Understand the key market trends, challenges, and opportunities in the Belgian retail savings and investments industry.
- Receive a comprehensive insight into the retail liquid asset holdings in Belgium, including deposits, mutual funds, equities, and bonds.