Anticipating 2021 boom, Q4 GDP revised up slightly to 4.1%
Many project a growth rate of 5% or more in the current quarter or more, with 9% growth the headline in some forecasts. AdFor all of 2021, economists are forecasting the GDP could grow by 6%. That would be the fastest annual GDP growth since the economy expanded 7.2% in 1984 when Ronald Reagan was president. These gains offset a slightly slower increase in consumer spending, which accounts for two-thirds of economic activity. The new report showed consumer spending growing at a 2.4% rate, slightly lower than the 2.5% gain initially estimated.
Fed confronts a shaky US economy that likely needs more help
Fed officials themselves, including Chair Jerome Powell, have sounded a similar message. In mid-March, when the virus first hit hard, the Fed accelerated its bond purchases to try to ease disruptions in the Treasury bond market resulting from the outbreak. The central bank later modified the rationale for its bond purchases by saying they would help support the economy — the same reason it gave during earlier bond purchases that it engineered to bolster the weak recovery from the 2008 financial crisis. In the past, critics have asserted that the Fed's aggressive bond buying risked destabilizing financial markets and triggering runaway inflation. “Fed officials have made it pretty clear they need help from Congress at this point.”
California jobless rate falls with help of temporary jobs
California lost more than 2.6 million jobs in March and April because of the coronavirus. California outperformed the nation as a whole, with its unemployment rate in August falling 2.1 percentage points compared to July while the national rate fell 1.8 percentage points to 8.4%. But compared to August of 2019, California has lost nearly 1.6 million nonfarm jobs. The county's unemployment rate is 16.6%, more than 5 percentage points higher than the statewide average. California's highest county jobless rate — 22.9% — is in Imperial County in the southeastern part of the state, bordering Arizona.
US is expected to report a record-breaking economic plunge
That would be more than triple the previous worst quarterly economic fall, a 10% drop set in 1958. On Thursday, the government will issue its first of three estimates of economic activity, as measured by the gross domestic product, for the April-June quarter. Sohn noted that the economy needed 6 years to regain the ground it had lost in the 2007-2009 Great Recession. Were trying to do everything we can, day by day, to keep the health of our business, Farish said. ___AP Business Writer Joyce M. Rosenberg in New York contributed to this report.
California's April jobless rate higher than Great Recession
California's unemployment rate nearly tripled in April because of the economic fallout from coronavirus pandemic. (AP Photo/Marcio Jose Sanchez, File)SACRAMENTO, Calif. California's unemployment rate nearly tripled to 15.5% in April as the nation's most populous state lost more jobs in one month from the coronavirus than it did during the Great Recession a decade ago, state data released Friday showed. More than two-thirds of those gains were wiped out last month as the state lost 2.3 million jobs. Nationwide, the unemployment rate reached 14.7% as all 50 states plus the District of Columbia reported increased job losses, according to the U.S. Bureau of Labor Statistics. But the surge of claims has exhausted the states unemployment trust fund, forcing it to borrow billions of dollars from the federal government.
Coronavirus poses tough challenge for economic policymakers
It’s also bedeviling policymakers and central bankers who are struggling to assess the economic damage from an outbreak that's reached 37 countries and territories, infected 80,000 people and killed 2,700 worldwide. Yet if they respond too slowly or timidly, they risk having the economic damage deepen and spread. When the virus began grabbing headlines last month, most economists were relatively sanguine about the economic damage it could cause. What happens in China carries far greater economic weight than it did 17 years ago. But he said it's "still too soon to even speculate about either the size or the persistence" of the coronavirus' effects.