Through fiscal 2030, the virus will reduce real economic output — nominal GDP adjusted for inflation — by 3% from initial economic estimates in January before the pandemic hit, the Congressional Budget Office said.
"Business closures and social distancing measures are expected to curtail consumer spending, while the recent drop in energy prices is projected to severely reduce U.S. investment in the energy sector," CBO Director Phillip L. Swagel said in a written response to an inquiry from Sen. Chuck Schumer . "Recent legislation will, in CBO's assessment, partially mitigate the deterioration in economic conditions.
Nominal GDP is expected to be $15.7 trillion, or 5.3%, less than originally forecast due to the coronavirus. Congress has passed the $2.2 trillion CARES Act aimed at cushioning the pandemic's blow and is debating another measure that could reach $3 trillion. However, the second quarter is still likely to see the biggest GDP drop in U.S. history while the unemployment rate for May is expected to be near 20%, the highest since the Great Depression.
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