US President Donald Trump was thrown into a non-uplifting economic report on Thursday. The gross domestic product in his country shrank by 9.5 percent quarter-on-quarter in the spring of 2020, according to data from the United States Department of Commerce.
The sharp drop in economic activity comes as no surprise. Like many European and Asian countries, large parts of the United States were locked this spring in an attempt to curb the spread of the coronavirus.
Economic activity fell most sharply between mid-March and mid-April. During that period, many companies were forced to shut down and families were sentenced to stay indoors. “Families kept their finger on the pulse, imports and exports declined and local governments and states spent less,” said a statement.
The federal government then raised its spending levels again. Congress gave the green light to aid measures with a price tag of more than $ 2,200 billion.
The US may have suffered its worst economic blow since the 1940s, but it still held up better than many European countries.
That démarche helped mitigate the economic impact of the health crisis a bit, says the Bureau of Economic Analysis. Americans let the money roll back a bit as soon as they received additional unemployment benefits and a federal government support check. Economic activity also picked up again as states began to roll back lockdown measures from May.
Nevertheless, the US is better off guarding too much optimism about the economic recovery. Since the coronavirus has been heavily hitting the south and west of the country for several weeks, the economy is having a harder time finding its second breath. In some states, lockdown measures have been tightened again and citizens are once again advised to stay in their dorm.
Federal support measures helped mitigate the economic impact of the health crisis a little.
With all its consequences. Figures from the United States Department of Labor showed on Thursday that more Americans are claiming unemployment benefits again.
The economic report has been dashed by Trump’s account. Before the lung virus started spreading like wildfire at the beginning of this year, the US was in its longest period of economic expansion. The billionaire was determined to focus his reelection race on that success story. Four months later, the corona pandemic hijacked the campaign.