U.S. Q2 GDP 'horrible', recovery could take long time: Experts
Updated: 2020-07-31 17:07:15 KST
Economists say the second quarter U.S. GDP annual rate was a little better than market forecasts, but it was still a "horrible" number.
Many of them predict the U.S. economy could see slow growth rates until 2021 and it could take some time to recover due to coronavirus concerns.
"And it's going to take years, not months to recover that. () But here's how the numbers work: you have a 33 percent contraction. You need a 50 percent expansion to get back to break even."
Some economists say even though the economy is starting to pick up, concerns still linger.
"GDP could be back to zero by the second quarter of next year. That doesn't mean the economy's back to the level it was prior to the shutdown, but it does mean that the bulk of the deterioration will be behind us within a one year period of time."
As for Germany, which witnessed its steepest contraction on record, an expert says the third quarter performance largely depends on their stimulus measures.
"The only thing for now is to leave this second quarter behind us and to move forward. It is up to the fiscal and economic policies and having the right measures in place. What we have seen up until now is not enough."
Hong Kong's economy also shrank by nine percent on-year from April to June.
Experts say what lies ahead may not be that rosy for the territory.
"The third quarter will be worse. Because in the second quarter, the restaurants and hotels were still open. In the third quarter, then we have a third wave of the pandemic. And then you had to shut the restaurants"
Economists say governments might be required to provide additional stimulus packages to boost the economy, but what's more important is containing the pandemic.
Yoon Jung-min, Arirang News.