US economy shrinks by 32.9% in the second quarter as businesses were forced to close their doors

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Economic output fell at its fastest pace on record in the second quarter as the coronavirus pandemic forced businesses across the United States to close their doors and kept millions of Americans shut in their homes for weeks. Gross domestic product tumbled at a rate of 32.9% on an annaualized basis, stats from the Commerce Department showed.

The collapse was unprecedented in its severity. The only possible comparisons in modern American history came during the Great Depression and the demobilization after World War II, both of which occurred before the advent of modern economic statistics.

Earlier today the German economy contracted at its steepest rate on record in the second quarter as consumer spending, company investment and exports all collapsed during the peak of the COVID-19 pandemic, wiping out nearly 10 years of growth.

The Federal Statistics Office revealed GDP in Europe’s largest economy shrank by 10.1% quarter-on-quarter from April to June after a 2% contraction in the first three months of the year.

The plunge was the steepest since the office began collecting quarterly growth data in 1970. Unlike past recessions, this one was a result of a conscious decision to suspend economic activity to slow the spread of the virus.

Congress pumped trillions of dollars into the economy to sustain households and businesses, limit long-term damage and allow for a rapid rebound.

Reference: Evening Standard:Mark Shapland 19 hrs ago: 30th July 2020