Congressional Budget Office Predicts Coronavirus Will Cost US Economy $15.7 Trillion
According to a recent forecast released by the Congressional Budget Office (CBO), the US is on track to lose approximately $7.9 trillion worth of economic activity over the next ten years, regardless of the federal government’s astronomical stimulus spending in order to prop up the economy.
Although many restrictions across the US are being lifted and both consumers and businesses are slowly starting to recover, the financial effects of the coronavirus pandemic are most likely going to be felt well into fiscal 2030. The report estimates that real economic output will be reduced by at least 3% when compared to previous pre-pandemic estimates, meanwhile nominal GDP will see a reduction of 5.3% – which translates to approximately $15.7 trillion.
Furthermore, the CBO is anticipating GDP levels to drop by the most in US history in the second quarter of 2020, while the month of May will have an unemployment rate of approximately 20% – the highest since the Great Depression. As a result, Senator Chuck Schumer is calling on the Senate to approve another round of fiscal stimulus in order to mitigate the impending negative impacts on the economy.
Information for this briefing was found via CNBC and the Congressional Budget Office. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
