(05 November 2021) Between Q2 2020 and Q1 2021, when the U.S. economy was struggling because of pandemic-related restrictions and high unemployment, an increase in government spending and tax cuts provided significant support to U.S. economic growth. However, after the fiscal stimulus programs ended in Q1 2021, the contribution of fiscal policy to U.S. GDP growth turned negative, according to the Hutchins Center Fiscal Impact Measure estimate.

  • The Hutchins Center estimates that in Q2 and Q3 2021, fiscal policy reduced U.S. real GDP growth by 2.2 and 2.4 percentage points respectively, mostly due to the end of supportive tax and benefits programs.
  • U.S. fiscal restraint is expected to continue in 2022 and 2023.

Definition: The Hutchins Center Fiscal Impact Measure (FIM) measures how much federal, state, and local tax and spending policy adds to or subtracts from overall economic growth. The FIM only measures the direct effects of fiscal policy and includes no multipliers.

Coronavirus Data and Insights

Live data and insights on Coronavirus around the world, including detailed statistics for the US, EU, and China — confirmed and recovered cases, deaths, alternative data on economic activities, customer behavior, supply chains, and more.

संबंधित जानकारी Knoema से

The World's Largest Economy: China vs United States

Which is the world's largest economy, China or the United States? As is usual in the field of economics, “It depends.” It depends on the methods used to estimate the size of an economy and to compare one economy to another. Despite modern discussions on refining the calculation of gross domestic product (GDP), the standard measure of an economy’s size and performance, to be more inclusive of economic factors that have been ignored to date, such as environmental and natural resource depletion, there is no commonly accepted alternative to GDP. There are, however, at least two commonly...

How Deep an Economic Decline Can the World Expect in 2020?

For the first time during the post World War II era, the global economy is expected to shrink due to measures in force worldwide to suppress the coronavirus, according to the IMF World Economic Outlook (WEO) released on April 14, 2020. In this edition of the WEO, the IMF shortened the forecast horizon to 2021 instead of the expected 2025 horizon and limited the number of indicators available in its statistical tables because of the high level of uncertainty in current global economic conditions. In the baseline scenario—which assumes that the pandemic fades in the second half of...

US Purchasing Managers Index Falls Below 50, Signals Contraction

In August, US manufacturing activity contracted 2.1 points from July, the largest contraction in nearly three years. According to the Institute of Supply Management (ISM) Purchasing Manufacturing Index (PMI) - commonly referred to as the ISM manufacturing index - fell to 49.1, making the US a late comer to a growing club of large economies, such as China, the Eurozone, Japan, and the United Kingdom, that have likewise reported contracting manufacturing sectors in recent months. The PMI is being dragged down by a sharp decline in new orders, non-farm employment (which increased by...

IMF Global Growth Projections | More Optimism Amidst New Fiscal Stimulus

(8 April 2021) Amid COVID-19 vaccination progress and new stimulus measures from the US government, IMF economists are predicting a shining near-term future for the global economy. Here are the key takeaways from the April 2021 edition of the IMF's World Economic Outlook (WEO) report: The IMF now estimates 2020 growth to have been -3.3 percent, a 1.1 percentage point upward revision from its October 2020 projection. The outlook for 2021 improved by 0.8 percentage points, to 6%, based on expected additional fiscal support in the US and other large economies and anticipated...