Hard data for May generally revealed sharp improvements in activity, particularly retail spending, albeit not to pre-virus levels. This led us to revise our forecasts for several economies including the US, UK and euro-zone, where we now expect falls in Q2 GDP to be less steep than we initially envisaged. However, renewed coronavirus outbreaks in some parts of the world have added to reasons to expect the recovery to slow in the months ahead. Indeed, timely indicators including restaurant reservations suggest that increased consumer caution is already taking a toll. The previous upward trend in the US seems to have stalled, due partly but not entirely to developments in the affected southern and western states. Meanwhile, even the relatively small and localised outbreak in Australia has seen bookings there nose-dive.
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