COVID-19 Incidence and Economic Confidence: Any Relationships So Far for the world’s Highly Affected Countries?

The world has experienced a huge setback in its progress on different fronts in the past couple of quarters due to the outbreak of the novel coronavirus, COVID-19; though, its ramifications are still continuing. It has swept away a sizable amount of gross domestic product (GDP) of the countries, making lay off a huge labour force, creating mental distress, among others, in the affected countries. Besides, the pandemic has affected the economic confidence of both the consumers and business houses during its phase. Under the backdrop, the study aims to investigate whether the COVID-19 incidences have any correlation and equilibrium relations with both the consumer and business confidences in the world’s highly affected countries, namely, the USA, the UK, Italy, Spain, France, India, Brazil, China, Russia and South Africa, using time series analysis for the monthly data of the period January 2020-August 2022. It finds positive correlations of Covid cases and death with business confidence (BCI) and negative with consumers’ confidence (CCI) in some of the countries. But, Covid death has maintained long-run relationships with CCI and BCI in many countries. The Granger causality test also depicts that Covid cases and deaths become the cause of the changes in consumers’ and business sentiments in some countries.