Financial markets are still in freefall despite the best efforts of governments to prop up the global economy.
The US Federal Reserve has announced more measures on top of the $1.8 trillion package already in the pipeline.
The plans include buying more government bonds and mortgage-backed securities to inject more cash into the economy.
The Federal Reserve said the coronavirus pandemic was “causing tremendous hardship across the United States and around the world.
“Aggressive efforts must be taken across the public and private sectors to limit the losses to jobs and incomes to promote a swift recovery once the disruptions abate.”
FTSE100 slips below 5,000
Shares in London and Europe rose on the news, but slipped back during the day’s trading.
The FTSE dropped 196 points to 4,993 at closing – down 3.79%.
The picture was the same across Europe.
The CAC40 in Paris lost 151 points to 3897, a fall of 3.74%, echoed by the German DAX, down 2.23% and the IBEX 35 in Madrid, Spain, 4.07% lower at close than end of business Friday.
The Pound continued to recede, losing another 1.85% to 1.06 against the Euro and 1.55% against eh US dollar, down to $1.14 – the lowest rate against the dollar since 1985.
Economies will take years to recover
The Organisation for Economic Co-operation and Development warned that the world economy may take years to recover.
Angel Gurría, OECD secretary general, warned the economic shock was already bigger than the 2008 financial crisis and believing that countries would bounce back quickly was ‘wishful thinking’.
“Even if you don’t get a worldwide recession, you’re going to get either no growth or negative growth in many of the economies of the world, including some of the larger ones, and therefore you’re going to get not only low growth this year, but also it’s going to take longer to pick up in the in the future,” he said.
“The reason is that we don’t know how much it’s going to take to fix the unemployment because we don’t know how many people are going to end up unemployed. We also don’t know how much it’s going to take to fix the hundreds of thousands of small and medium enterprises who are already suffering.”