Never before has the outlook for the near future of the Latvian economy deteriorated as sharply as it did in February and March of this year. Never has it improved so rapidly as in the two following months – April and May. However, the starting point of this improvement was a moment of extreme anxiety and uncertainty.

Describing the processes currently taking place in the economy is a massive improvisation, and providing forecasts is a high-risk endeavour. In this process, one has to break the usual rules of the game and risk causing confusion for the audience. However, at a time when the economic environment for business operations is changing so rapidly, decision-makers must endeavour to provide the best possible assessment of the situation at that moment, even if information is limited and chaotic, and circumstances are changing quickly. On 31 March, I stated a forecast on social media – that GDP would decrease by about 10% this year. This figure was well-founded at a time of enormous uncertainty. For example, in March, a plausible scenario was the closure of most non-food retail trade, as had already happened in several Western European countries. There was no certainty that a significant flow of foreign tourists would be possible this summer.