The study, conducted by the National Association of Business Economics, showed that experts expected a severe and short recession for the first half of 2020, while the Corona virus severely restricted economic activity.
Economic growth is expected to have decreased by 2.4% in the first quarter, according to the association’s expectations, and will decrease by 26.5% in the second quarter.
The US labor market will also be affected greatly as the outbreak closes companies. The association expects the unemployment rate to rise to 12% by the middle of the year, while the United States of America may lose 4.58 million jobs in the second quarter. And job losses will affect spending, the main driver of the American economy, as consumer spending accounts for about 70% of economic growth.
Despite the sudden downturn, economists remain optimistic that the economy will rebound again in the last half of 2020, as it is expected to grow at approximately 6% by the end of the year.
“The average expectation indicates that conditions will improve by the end of the year with the support of massive fiscal and monetary stimulus,” said Assembly President Constance Hunter.
On Thursday, the Federal Reserve announced an additional $ 2.3 trillion in loans to small businesses and consumers. The move comes in addition to many other lending programs at the central bank, and cut interest rates to zero in an attempt to support the US economy.