Stimulus (economics) in the context of "Economic impact of the COVID-19 pandemic"

Following the start of the COVID-19 pandemic in 2020, a worldwide surge in inflation began in mid-2021 and lasted until mid-2022. Many countries saw their highest inflation rates in decades. It has been attributed to various causes, including pandemic-related economic dislocation, supply chain disruptions, the fiscal and monetary stimulus provided in 2020 and 2021 by governments and central banks around the world in response to the pandemic, and price gouging. Preexisting factors that may have contributed to the surge included housing shortages, climate impacts, and government budget deficits. Recovery in demand from the COVID-19 recession had, by 2021, revealed significant supply shortages across many business and consumer economic sectors.

In early 2022, the effect of the Russian invasion of Ukraine on global oil prices, natural gas, fertilizer, and food prices further exacerbated the situation. Higher gasoline prices were a major contributor to inflation as oil producers saw record profits. Debate arose over whether inflationary pressures were transitory or persistent, and to what extent price gouging was a factor. All central banks (except for the Bank of Japan, which had kept its interest rates steady at −0.1% until 2024) responded by aggressively increasing interest rates.

The German economic crisis is a significant downturn of Germany's economy that marked a dramatic reversal of its previous "labour market miracle" period of 2005–2019. The country, which had been considered to be Europe's economic powerhouse in prior decades, became the worst-performing major economy globally in 2023 with a 0.9% contraction, followed by further 0.5% contraction in 2024 leading to recession. Several economists, business figures, and other experts expressed concern that Germany's economic downturn could cause the nation to reclaim its reputation as the "sick man of Europe" from the 1990s. Economists stated that Germany's economy was in a permanent crisis mode, with the Handelsblatt Research Institute declaring that it was in its "greatest crisis in post-war history" after projecting a third consecutive year of recession in 2025.

This decline was attributed to multiple factors: A lack of urgency in diversifying its energy supply before 2022 leading to increased energy prices (coinciding factors include the Russian invasion of Ukraine, its nuclear power phase-out, slow pace of energy transition, and increased cost of fossil fuels partly due to tax increases), comparatively lower productivity due to slow adaptation of digital technologies, German politics (specifically the debt limitation, the CDU/CSU-filed application to the Federal Constitutional Court successfully deeming a €60 billion climate fund unconstitutional as well as the subsequent in-fighting within the governing Scholz cabinet) obstructing economic stimuli, global shifts in demand hurting the country's export-led economy while its higher internal real wage growth-led demand is delayed due to high cost of living, as well as a skilled worker shortage arising from demographic challenges such as population ageing, low participation of women in the workforce and slowing immigration to Germany.

Joe Biden's tenure as the 46th president of the United States began with his inauguration on January 20, 2021, and ended on January 20, 2025. Biden, member of the Democratic Party, had previously served as the 47th vice president from 2009 to 2017 under President Barack Obama, took office after defeating the Republican incumbent president Donald Trump in the 2020 presidential election. Upon his inauguration, he became the oldest president in American history, breaking the record set by Ronald Reagan. Alongside Biden's presidency, the Democratic Party also held their majorities in the House of Representatives and the Senate during the 117th U.S. Congress following the 2020 elections, thereby attained an overall federal government trifecta. Biden entered office amid the COVID-19 pandemic, an economic crisis, and increased political polarization.

Day one actions of his presidency included restoring U.S. participation in the Paris Agreement, revoking the permit for the Keystone XL pipeline and halting funding for the Mexico–United States border wall. On his second day, he issued a series of executive orders to reduce the impact of COVID-19, including invoking the Defense Production Act of 1950, and set an early goal of achieving one hundred million COVID-19 vaccinations in the United States in his first 100 days. The first major legislation signed into law by Biden was the American Rescue Plan Act of 2021, a $1.9 trillion stimulus bill that temporarily established expanded unemployment insurance and sent $1,400 stimulus checks to most Americans in response to continued economic pressure from COVID-19. He signed the bipartisan Infrastructure Investment and Jobs Act, a ten-year plan brokered by Biden alongside Democrats and Republicans in Congress to invest in American roads, bridges, public transit, ports and broadband access.

The 2010 G20 Toronto summit was the fourth meeting of the G20 heads of state/government, to discuss the global financial system and the world economy, which took place at the Metro Toronto Convention Centre in Toronto, Ontario, Canada. The summit's priorities included evaluating the progress of financial reform, developing sustainable stimulus measures, debating global bank tax, and promoting open markets. Alongside the twenty-one representatives of the G20 major economies, leaders of six invited nations, and eight additional intergovernmental organizations also took part in the summit.

Prior to the summit, Canadian Prime Minister Stephen Harper announced that the theme would be "recovery and new beginnings," referring to an anticipated economic stimulus from the impact of the ongoing world recession. Harper initially proposed to hold the summit in Huntsville, Ontario, where the 36th G8 summit was scheduled immediately prior. Organizers later deemed the town insufficient to provide hospitality for the large number of G20 delegates and journalists, favouring Toronto as the host location.

The COVID-19 pandemic caused far-reaching economic consequences including the COVID-19 recession, the second largest global recession in recent history, decreased business in the services sector during the COVID-19 lockdowns, the 2020 stock market crash (which included the largest single-week stock market decline since the 2008 financial crisis), the impact of COVID-19 on financial markets, the 2021–2023 global supply chain crisis, the 2021–2023 inflation surge, shortages related to the COVID-19 pandemic including the 2020–2023 global chip shortage, panic buying, and price gouging. The pandemic led to governments providing an unprecedented amount of stimulus, and was also a factor in the 2021–2022 global energy crisis and 2022–2023 food crises.

The pandemic affected worldwide economic activity, resulting in a 7% drop in global commercial commerce in 2020. Several demand and supply mismatches caused by the pandemic resurfaced throughout the recovery period in 2021 and 2022 and were spread internationally through trade. During the first wave of the COVID-19 pandemic, businesses lost 25% of their revenue and 11% of their workforce, with contact-intensive sectors and SMEs being particularly heavily impacted. However, considerable policy assistance helped to avert large-scale bankruptcies, with just 4% of enterprises declaring for insolvency or permanently shutting at the time of the COVID-19 wave. According to a 2021 global modeling study, the travel and tourism sector alone could contribute to a worldwide GDP loss of up to US$12.8 trillion if the pandemic extended through the end of 2020. The study further predicted over 500 million global job losses in related industries, highlighting tourism as one of the most severely impacted sectors.