The U.S. economy’s recovery might have already hit its peak for the time being.
A new Wall Street Journal (WSJ) report finds that the widespread reopening of businesses, more vaccinations becoming available over time and more government-fueled pandemic aid had helped things reach a high point in the spring.
But from here on out, economists have predicted things might slow down.
According to them, the economy is likely to keep growing at a solid and steady pace for the next year with more job gains and people using the savings they’d gotten over the lockdown period.
After that, they think things will likely cool down into something resembling the pre-pandemic era.
“We’ve moved into the more moderate phase of expansion,” said Ellen Zentner, chief U.S. economist at Morgan Stanley. “We’re past the peak for growth, but that doesn’t mean something more sinister is going on here and that we’re poised to then drop off sharply.”
The WSJ surveyed economists and found that they think the economy expanded at around 9.1 percent seasonally adjusted rate from April to June.
This constitutes the second-fastest pace since 1983, with only last summer’s rapid rebound from the freefall of the pandemic’s economic effects beating it, WSJ writes. And several economists have said they think the U.S. GDP surpassed what it had been pre-pandemic in the second quarter.
A July 15 PYMNTS report had jobless reports hitting a new low since the pandemic hit.
The report found that the jobless claims for the week ending July 10 were down to 360,000, a decrease of 26,000 from the previous week and the lowest level for initial claims since March 14, 2020.
PYMNTS writes that the total number of continued weeks claimed for benefits in the week ending June 26 was around 13.9 million, which was a 372,000 decline from the previous week.
But despite the dropping claims, PYMNTS noted that the numbers were still higher than 2019’s on average.