U.S. weekly jobless claims surged past expectations last week, as 6.6 million Americans filed for benefits in the period ended April 4.
In a span of three weeks, nearly 17 million Americans have lost their jobs, a number that surpasses job losses between 2007 and 2009.
It appears that the worst is not yet over. The U.S. is now the epicenter of the coronavirus pandemic and the International Monetary Fund (IMF) just issued a terrifying warning for the global economy.
With over 435,000 COVID-19 cases, the U.S. is bearing the brunt of the pandemic. Businesses big and small are laying off workers and implementing measures to keep their heads above water. Unemployment is rising faster than anyone could have imagined.
JPMorgan’s chief U.S. economist predicted that unemployment could peak at 8.5%. Other predictions are even grimmer.
Less than a month after the pandemic crippled the U.S. economy, one in ten Americans are out of a job. At this rate, jobless claims will likely exceed even the worst forecasts.
The U.S. unemployment rate looks awful, and it appears that there’s no end in sight. IMF chief Kristalina Georgieva says that the coronavirus pandemic is creating a crisis unlike the world has ever seen in 100 years.
Georgieva stressed that “global growth will turn sharply negative in 2020,” as 170 out of 180 IMF members see a reduction in per capita income.
In fact, we anticipate the worst economic fallout since the Great Depression.
I stress there is tremendous uncertainty around the outlook: it could get worse depending on many variable factors, including the duration of the pandemic.
The IMF chief emphasized that a massive response is needed to ignite recovery. The good news is that the Federal Reserve is quick to launch its bazookas. The central bank is grabbing headlines after announcing that it is releasing another $2.3 trillion in aid to assist Main Street and local governments.
2020 is turning out to be an exceptionally difficult year. Agencies are acting like we’re in the worst crisis in our lifetime. It seems that COVID-19 is hitting the economy harder than anyone could have imagined.
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