Jerome Powell (Credit: Office of the Federal Reserve)
Business and academic economists polled by The Wall Street Journal expect GDP to increase at an annualized rate of 23.9% in the third quarter. That is up sharply from an expectation of an 18.3% growth rate in the previous survey. The projected rebound for the third quarter would recoup about half of the output lost in the first half of the year.
Labor market strengthening: Economists also see faster improvement in the labor market, after employers added 1.37 million jobs to payrolls last month. The unemployment rate fell below 10% in August for the first time since March to 8.4%, and economists now expect the jobless rate to tick down to 8.1% in December.
Events that could stunt economic recovery: “A second wave of the coronavirus, escalating tensions with China, contested elections, civil unrest, and insufficient fiscal stimulus could be a toxic cocktail that pushes the economy into a second dip in the fourth quarter.” [WSJ]