US Economy Expected to Begin Recovery in Q3: ABA Forecast

The U.S. economy will experience about a 6% contraction this year, but will begin to recover from a severe second-quarter downturn in the third quarter, according to the latest forecast of the American Bankers Association’s Economic Advisory Committee.

While the group, made up of 16 chief economists from some of the North America’s largest banks, is unanimous that the economy will expand in the third quarter, there are a wide range of views as to the damage caused by the COVID-19 shock. Four committee members believe the economy will shrink less than 5% in 2020 while just as many see a greater than 8% contraction. The committee members were divided on when they expect economic output to recover to the pre-pandemic level, with the largest number of committee members forecasting it will happen in 2022.

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