Commentary

Outbreak puts global stimulus in spotlight

Economists say govt spending will play a more significant role in coming years

Restaurant staff waiting for customers in Haji Lane, as tourist arrivals to Singapore fall amid the coronavirus outbreak.
Restaurant staff waiting for customers in Haji Lane, as tourist arrivals to Singapore fall amid the coronavirus outbreak. PHOTO: REUTERS
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Pumping money into the economy to counter a sudden drop in production and lack of raw materials can be risky, but sitting idle while the disruption spreads across the entire economy and eventually depresses overall demand is not a smart move either.

Those risks are why governments and central banks worldwide are employing a range of policy tools to avoid a recession and calm financial markets and investor nerves.

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A version of this article appeared in the print edition of The Straits Times on March 07, 2020, with the headline Outbreak puts global stimulus in spotlight. Subscribe