The global economy has more or less ground to a halt with the advent of COVID-19. This dramatic impairment of economic activity in the United States and around the world will make for some very ugly economic numbers. What we have seen so far in China and Europe is only a hint at what’s ahead.

The Chinese economy was relatively normal in January but was in an effective lockdown in February. For the two months combined, industrial production dropped by 13.5% year over year and the service sector gross output dropped by 13.0%.

Note that the months were reported together because of the shifting Lunar New Year. Roughly speaking, stripping out January and focusing on February would suggest declines of double the reported numbers. Data from Italy (perhaps the worst-hit country in Europe) in the next few days will be crucial to see if the measures taken so far are working.

Merrill Lynch’s Head of Europe Economics Research, Ruben Segura Cayuela, is looking for a decline in the Purchasing Managers’ Index (PMI). Tuesday, the IHS Markit PMI data for March for many euro area countries will be released, and this could just be the tip of the iceberg for more economic numbers to come.

Merrill Lynch expects the manufacturing PMI in France will drop by 9.6 points to 40.2 and the German PMI to fall from 48.0 to 39.0. The United States is running a week or so behind Europe in the impact of both the virus and the shutdown. Mid-month regional surveys have dropped off, with the Philly Fed and Empire State manufacturing surveys reporting record monthly declines and signaling contractionary activity.

Looking ahead, the brokerage firm now calls for weekly jobless claims to hit 3 million for the week ended March 19. Merrill Lynch further detailed this point:

Up next, we expect a dramatic jump in initial jobless claims on Thursday. Smaller companies simply can’t afford to pay workers for weeks at a time without generating revenues. Those who can will claim unemployment insurance, but there remain significant holes in the system so the real rise in unemployment will be much higher. As this goes to press, the Trump Administration is reportedly encouraging states to withhold the data and only report generalities on state filings. In our view, as with prior attempts to downplay the crisis, this could do more harm than good. There is an additional risk that the system gets overwhelmed with applications. Whether all of this is a bad memory a few months from now depends on the private and public response to the crisis. We have ample evidence from Asia that social distancing can work if it is implemented consistently. However, there is still no national policy, state and local governments range from effective to ineffective and press reports suggest the general public hasn’t learned the drill.

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