Question

What has been the effect of COVID-19 on the United States' GDP, unemployment, and inflation? please mention the sequence of events and conclusion of all three

Answer 1

Answer: The coronavirus (COVID-19) pandemic had great long term negative impact on united States in reference to GDP, unemployment & Inflation.

GDP: COVID-19 led to a drastic and sudden reduction in economic activity. And this led GDP to dropping by an annualized rate of 4.8 percent in the first quarter of 2020. And it is expected to decline further. And real GDP will not catch up to the level soon until 2030 — indicating that the pandemic will have a lasting economic impact.

Unemployment: COVID 19 may have a significant, long-term effect on the U.S. labor market it will witness its steepest decline since the 1930s, with the average unemployment rate climbing to 15.0 percent. However, it is expected theat unemployment rate to gradually decline in the following years

Inflation: Due to the negative trend in the economy because of pandamic it would take years before rates on longer-term Treasury securities begin to rise noticeably. Treasury notes would remain relatively stable over the next decade. However, the pandemic has led to an increased demand of such low-risk assets and, in conjunction with the Federal Reserve’s purchases of various Treasury securities, those long-term rates fell to historic lows and are now expected to rise very gradually in upcoming years.

Therefore, the effect of COVID-19 on the United States is long lasting and it will take some time to get recover.