During the summer months, the economy found its Covid-era footing. The nation, and indeed much of the world, learned to co-exist with the pandemic as infection rates declined from early peak and progress occurred in testing and vaccine development. Some segments of the economy were able to re-open at least partially, while others remain under siege. Virus-induced changes in lifestyles have created some economic winners – used car sales, suburban single-family housing, and online retail among them.
Markets refocused on economic releases in the third quarter, as analysts were able to better digest the crazy quilt of pandemic-era data. GDP (annualized quarter-over-quarter) dropped an astounding 31% in the second quarter, but third quarter projections are showing a strong rebound. The Bloomberg composite forecast for 2020 annual GDP now sits at -4.4%, a major drop by any standard, but nonetheless, a testimony to the efficacy of the policy response, as many prognosticators initially predicted a bigger decline. Labor market data for the most part exceeded expectations as manifest in the unemployment rate, which fell nearly three percentage points during the period.