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The economic catastrophe as a result of Corona in America appears gradually, today, Thursday, April 16, 2020 4:09 pm
Sales of clothing and accessories shops have halved, at a time when a large portion of people are working in their homes and closed many of the stores.
The crisis also affected restaurants and bars, many of which were forced to close in March, and their revenues decreased by 25.5%.
As for food and beverage stores, which continued to be considered essential, their sales increased by 26.5%.
For his part, the US Federal Reserve said in a report on Wednesday that the American economic activity “shrunk sharply and surprisingly” as a result of the measures of domestic quarantine.
The sectors worst affected are the entertainment and hotel sectors, as well as retail (except for essential products), according to the survey conducted by US companies surveyed before April 6.
The US central bank stated that companies “expect most of them to worsen the situation in the coming months.”
“Even if the economy returns to work in May, consumers will need time to adapt their behavior. The path of resumption may be long and slow,” warned chief economist at the National Federation of Retail Sales, Jacques Kleinhenz.
Analysts at the Oxford Economics Institute expect that household spending in the second quarter of the year will be twice that of the same quarter last year, while household consumption will account for 70% of US GDP.
Factories also gradually closed or slowed down their work last month, and industrial production fell 5.4% from the February level, according to Fed data.
In his report, the Federal Reserve indicated that this is the largest decline recorded since January 1946, noting that “most major industries recorded a decline, and the largest decline was related to cars and their parts.”
In the New York area, the epicenter of the epidemic in the United States, industrial activity fell in early April to its lowest historical levels, according to the New York Federal Reserve Branch announced Wednesday.
Unemployment has been continuously increasing in the United States since mid-March and reaching unprecedented levels.
After the job market had registered the best indicators for fifty years, it collapsed in just 3 weeks with 16.7 million people having to apply for unemployment assistance.
In his report, the Federal Reserve expected unemployment to continue to rise.
The situation is bad in all regions and companies resort to “temporary layoffs” and breakdowns, and they hope to return to normal conditions when activity resumes.
Major American banks have warned that they expect numbers of people and companies to default on loan installments.
The massive $ 2,200 billion federal aid plan is supposed to help the world’s first economy weather this unprecedented crisis.
The families began to receive checks from the government for $ 3400, for example, for a family of two adults and two children.
It also put liquidity in the form of loans at the disposal of companies, especially medium and small, through several mechanisms, so that it can continue to pay the salaries of its employees and avoid layoffs.
The daily toll of the new corona virus, on Wednesday, in the United States was 27085 deaths and 614,482 infections, according to an official census announced by Johns Hopkins University.