United States economy plunged a record 32.9% in the second quarter

US GDP contracted by a record-shattering 32.9% pace last quarter

The new figures confirm that Germany has been in recession as the term is often defined - two consecutive quarters of declining GDP. Compared to the same quarter of 2019, economic activity fell a less-dramatic 9.5%, still the worst figure on record.

In the first quarter of this year, when the U.S. officially entered recession in February, the economy shrank 5 percent from the same period a year ago.

The first of estimate by INE is broadly in line with the forecast by the Bank of Spain which had seen a contraction in the economy of between 16 and 22 percent for the period between April to June at the height of the lockdown when all non-essential activities were halted.

The United States GDP suffered the worst recorded drop in American history in Q2 2020, an annualized rate of almost 33 percent. Austria suffered a 10.7% contraction and Belgium by just over 12%.

Investment fell by a greater amount - nearly 18%. Household consumption dropped by around 21 percent and business investment by 22 percent while exports fell by around a third. "We saw declines basically across the entire economy".

France's economy shrank by almost 14% in the second quarter when the country was in coronavirus lockdown, a third consecutive quarter of negative growth in a worsening recession, the national statistics agency said Friday, July 31, 2020. "We expect it will take years for that damage to be fully recovered", said Andrew Hunter, senior USA economist at Capital Economics.

"The hard part of this recovery is set to start about now", Colijn said.

"This moment has passed, it is true that after resisting (the virus) came the economic revival, and now we must focus on what the economic recovery means".

Economists say the worst of the downturn is past as many restrictions have eased, but that the recovery will be drawn out and vulnerable to renewed virus outbreaks.

Many economists note that the economy can't fully recover until the coronavirus is defeated - a point stressed Wednesday at a news conference by US Federal Reserve Chair Jerome Powell.

Yet with the rate of confirmed coronavirus cases having surged in a majority of the states, more businesses being forced to pull back on reopenings, and the Republican Senate proposing to scale back government aid to the unemployed, the economy could worsen in the months ahead.

Continuing claims, the number of people receiving benefits for more than a week, jumped to over 17 million while the insured unemployment rate rose to 11.6% in the week ended July 18.

Unemployment hit 15.3 percent by the end of June and is expected to reach 19 percent by the year's end, the government says, although the International Monetary Fund sees it rising to as much as 20.8 percent.

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