news

COVID-19: US economy 'contracted sharply' in all regions: Fed

US economy 'contracted sharply' in all regions, US employment will fall further : Fed




US economic activity "contracted sharply and abruptly" nationwide amid the lockdowns imposed by the coronavirus pandemic, the Federal Reserve said Wednesday.


Businesses across all regions "reported highly uncertain outlooks... with most expecting conditions to worsen in the next several months."

The "beige book" report showed the early signs of the carnage spreading through the US economy as factories, shops and restaurants were forced to shut down nationwide.

Government reports have shown 17 million workers lost their jobs in the three weeks through April 4, and the Fed said "the near term outlook was for more job cuts in coming months."

With over two million cases worldwide, the spread of COVID-19 has driven the global economy into recession, with the International Monetary Fund warning $9 trillion will be slashed from global GDP.

The Fed responded quickly, slashing the benchmark interest rate to zero last month and pumping trillions of dollars in liquidity into the financial system and loan markets to prevent a collapse.

The United States has the most deaths of any country with 26,059 fatalities and 609,516 reported infections.

The Fed report said the hardest-hit industries, because of social distancing measures and mandated closures, were leisure and hospitality, and retail aside from essential goods.

Most of the 12 Fed districts reported declines in manufacturing as well, and though food and medical products reported strong demand they faced both production delays, due to infection-prevention measures, and supply chain disruptions.

The report was prepared in advance of the April 28-29 meeting of the central bank's policy-setting Federal Open Market Committee, using information collected through April 6.

hs/cs

This story was produced by AFP. For more information go to AFP.com.
© Agence France-Presse

No comments

Poster Speaks

Poster Speaks/box

Trending

randomposts