In the US, another 1.5 million people applied for unemployment benefits

The number of applications for benefits has been falling for 12 consecutive weeks.

In the US, another 1.5 million people applied for unemployment benefits last week, the Labor Department said on Thursday. This is the lowest figure over the previous three months.

The number of applications for benefits has been falling for 12 weeks in a row. Still, the authorities predict that the economy will recover for a long time and will not return to its previous state by the beginning of 2021.
In total, 44 million people have applied for benefits since mid-March – more than a quarter of the workforce, with a total of 164.6 million people.

However, the number of people receiving benefits has now fallen to 20.9 million, as many have returned to work due to the relaunch of companies.
According to official data, the unemployment rate in May was 13.3 percent, although, taking into account the statistical error, it can reach 16.4 percent.
The Fed forecasts that the unemployment rate will fall to 9.3 percent by the end of this year, and to 6.5 percent by the end of 2021. Some economists give more pessimistic forecasts.

Fed chief Jerome Powell on Wednesday acknowledged that unemployment puts millions of Americans in an awkward position.

“Unemployment remains at a historically high level,” he said at a news conference. – The economic downturn has not affected all Americans equally. Rising unemployment is particularly hard on low-paid workers, women, African-Americans, and Latinos.”

At the end of the two-day meeting, the Fed said: “The ongoing health crisis will weigh heavily on economic activity, the labor market, and inflation in the short term, and presents significant risks to the economic outlook for the medium term.”

Congress and the White House are considering whether to provide additional assistance to American families to speed up the economic recovery.

Treasury Secretary Steven Mnuchin, speaking to Congress on Wednesday, said: “I believe we will need another bipartisan bill to inject additional funds into the economy.”

President Donald Trump, who faces a re-election battle in November, predicts a substantial recovery in the economy.

“The Nasdaq has reached a historic high. We are making great progress, and we are well ahead of schedule. The USA!” he tweeted on Wednesday.
However, the coronavirus has hit trading activity in the US hard: in May, more than a dozen companies declared bankruptcy, and some reported closing permanently.

According to government data, the country’s GDP shrank by 4.8 percent in the first quarter. Still, this figure does not take into account all the consequences of the pandemic, which became apparent in the second quarter.

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