Deficit to soar to nearly $4T as economy buckles, CBO says
The current economic downturn will drag on for months, with double-digit unemployment rates rocking the labor market and a deficit ballooning to $3.7 trillion this year, the Congressional Budget Office said in a grim projection Friday.
The independent budget agency estimated that the unemployment rate will rise to 16 percent later this year, dropping to 9.5 percent by the end of 2021. By that time, the labor force will have “about 6 million fewer people,” CBO noted.
Improvements in the economy are forecast beginning in the third quarter of this year, but a "sharp contraction" will persist through the end of June, the agency said. "In the third quarter, economic activity is expected to increase, as concerns about the pandemic diminish and state and local governments ease stay-at-home orders, bans on public gatherings, and other measures restraining economic activity," CBO said.
"However, challenges in the economy and the labor market are expected to persist for some time. Interest rates on federal borrowing are expected to remain quite low in relation to rates in recent decades."
https://www.msn.com/en-us/news/politics/deficit-to-soar-to-nearly-dollar4t-as-economy-buckles-cbo-says/ar-BB139Tiu?li=BBnb7Kz
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