The global economy faces a crushing blow far worse than the financial crisis as lockdowns paralyse businesses and families across the world, the International Monetary Fund has warned.

An estimated $9 trillion (£7 trillion) of output will be lost this year and next, the institution (IMF) said – equal to the combined economies of Germany and Japan.

Overall its economists expect global GDP to fall by 3pc in 2020, the biggest drop in almost a century.

The figures underline growing fears that measures to combat Covid-19 risk causing catastrophic damage to the world economy which will tip millions into poverty and take many years to overcome.

Gita Gopinath, the IMF's chief economist, said: “As countries implement necessary quarantines and social distancing practices to contain the pandemic, the world has been put in a Great Lockdown.

“The magnitude and speed of collapse in activity that has followed is unlike anything experienced in our lifetimes. This is a crisis like no other.

“This makes the Great Lockdown the worst recession since the Great Depression, and far worse than the global financial crisis."