The new estimate was based in part on news that new weekly unemployment claims hit 6.6 million
The Congressional Budget Office says the unemployment rate will shoot up above 10 percent and gross domestic product will contract by at least 7 percent in the second quarter in an updated economic forecast reflecting the disruption caused by the coronavirus.
The decline in GDP could be “much larger,” CBO Director Phillip Swagel wrote in a blog post Thursday where he noted that the forecast included the impacts from the more than $2 trillion law signed into law Friday, March 27. Swagel called the estimates “very preliminary” based on economic data available as of Thursday morning.
“CBO expects that the economy will contract sharply during the second quarter of 2020 as a result of the continued disruption of commerce stemming from the spread of the novel coronavirus,” Swagel wrote. Continue reading.