Experts believe US GDP will fall in the second quarter

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Experts believe US GDP will fall in the second quarter
March 23
09:00 2020

The authoritative publication The Wall Street Journal has carried out a survey of leading US economists. Most experts have changed forecasts. Analysts agree that there will be large job losses in the States, which will lead to a sharp drop in GDP in the second and, possibly, in the third quarters.

Experts disagree in quantitative estimates of the decline in the US GDP. Optimists believe that it will amount to 4%, while pessimists believe that GDP will fall by 10%. Goldman Sachs analysts went the furthest and calculated that the unemployment would rise to 9%, and GDP might well decrease by 24%.

One thing is clear right now: the crisis that has begun will be comparable to the decline ten years ago. By the way, the US GDP fell by 8.8% in annual terms in the worst quarter of 2008.

Analysts also believe that the crisis will be replaced by a marked increase in economic indicators.

There is an optimistic scenario, according to which GDP will increase 1.7% in the third quarter, and at the end of the year it will grow 3.1%. Pessimists believe that the recession will continue in the third quarter and amount to 3.8%, but in the fourth quarter a decrease in GDP will total 0.5%.

Economists believe that markets have a good chance to recover immediately after the end of the coronavirus pandemic.

It is expected that this week, there will be a rather serious increase in the number of applications for unemployment benefits – 875,000. Pessimists believe that about 2 million Americans will lose their jobs.

 

The material was prepared with the participation of Katya Wilson,
a leading analyst of the brokerage company UFT Group

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