Mon. May 23rd, 2022


The Real News Network

Economic data coming today will gauge the recovery’s progress.

2 min read

Government data on Thursday is expected to show that the U.S. economy experienced strong growth in the second quarter of the year. The next test will be whether that momentum can continue as coronavirus cases rise, masks return and government help wanes.

Economists surveyed by FactSet expect the report from the Commerce Department to show that gross domestic product, the broadest measure of economic output, grew 2.1 percent in the April-to-June period, up from 1.6 percent in the first three months of the year.

That growth would bring output, adjusted for inflation, back to its prepandemic level, a remarkable achievement one year after the economy suffered its worst quarterly contraction on record. After the last recession ended in 2009, G.D.P. took two years to rebound fully.

But the recovery is far from complete. Other economic measures remain deeply depressed, particularly for certain groups: The United States still has nearly seven million fewer jobs than before the pandemic. The unemployment rate for Black workers in June was 9.2 percent.

Now a new threat is emerging in the form of the highly contagious Delta variant of the coronavirus, which has led to a surge in cases in much of the country. The Centers for Disease Control and Prevention recommended this week that even vaccinated people should wear masks indoors in some parts of the country, and some mayors and governors have reimposed mask mandates.

Few economists expect a return to widespread business shutdowns or stay-at-home orders. But if the resurgent virus leads to renewed caution among consumers — a reluctance to dine at restaurants, hesitation about booking a late-summer getaway — that could weaken the recovery at a crucial moment.

“The reason that is concerning is that this burst of activity around reopening has been driving the economy the past couple months,” said Michelle Meyer, head of U.S. economics at Bank of America. “Even a modest change in behavior could show up more meaningfully this time around.”

Source: Read Full Article