The coronavirus outbreak, which originated in Wuhan, China, has currently infected more than 982,951 people. Its spread has left businesses around the world counting costs. However, how has the COVID-19 impacted the United States economy?
This live coronavirus article has been updated on April 2, 2020.
April 2, 2020 | AtoZ Markets –As the coronavirus pandemic continues to sweep across Europe, the United States has seen thousands of confirmed cases. The number of confirmed coronavirus cases in the US has risen to 226,978, and 5,343 people have died from the disease. The number of confirmed cases globally has increased to 982,951, while the total number of deaths has risen to 50,264.
Top impacted US States due to coronavirus
The coronavirus death toll in the United States is now higher than mainland China’s, though there are mounting questions about the integrity of China’s count.
In the United States, the outbreak in New York remains the largest in the nation, with more than 1,200 deaths, and is weeks away from its apex, Gov. Andrew M. Cuomo warned. More than 250 coronavirus patients died between Sunday and Monday. Nevertheless, the governor said that number could ultimately reach 800 a day.
In Michigan, state officials reported 50 additional deaths on Monday, even as they cautioned that the outbreak was still in the early stages.
Gov. John Bel Edwards of Louisiana said his state was a few weeks behind New York, as he reported a surge in deaths to 185 from 34 in just 24 hours.
Virginia, Maryland and the District of Columbia became the latest places to order residents to stay at home.
How is COVID-19 impacting the US economy?
Consensus continues to grow among government leaders and health officials that the best way to defeat the coronavirus is to order nonessential businesses to close and residents to confine themselves at home. Britain, after initially resisting such measures, essentially locked down its economy on Monday, as did the governors of Virginia, Michigan and Oregon. More than 100 million Americans will soon be subject to stay-at-home orders.
Relaxing those restrictions could significantly increase the death toll from the virus, public health officials warn. Many economists say there is no positive trade-off — resuming normal activity prematurely would only strain hospitals and result in even more deaths while exacerbating a recession that has most likely already arrived.
The economic shutdown is causing damage that is only beginning to appear in official data. Morgan Stanley researchers said on Monday that they now expected the economy to shrink by an annualized rate of 30 percent in the second quarter of this year, and the unemployment rate to jump to nearly 13 percent. Both would be records, in modern economic statistics.
Boeing will temporarily shut its Washington State factories
Across the landscape of American business, grim news abounded Monday as the coronavirus pandemic paralyzed the country.
Boeing announced on Monday that it will temporarily shut down its operations in Washington State. The company made the announcement after about 30 employees tested positive for Covid-19.
The factories will close for two weeks and all of the 70,000 employees will continue to receive paychecks. Boeing is in contact with the Pentagon to determine how to handle its work on the KC-46 tanker and P-8 military aircraft, which are made in the Washington factories.
For now, the company’s other major production facilities, in Missouri, South Carolina, Arizona, and Pennsylvania, will remain open.
Moreover, Twitter said its revenue would take a hit as advertising has declined. Nordstrom, its cash diminished, drew down $800 million in credit. And General Electric said it would cut 10 percent of workers in its aviation unit.
The S&P 500 fell about 3 percent Monday, adding to a 15 percent plunge last week as traders remained cautious about the Fed’s ability to shift the trajectory of an economy that appears to be in free-fall because of the coronavirus crisis.
The biggest factor again driving markets was Congress. They hit another wall while trying to push through a fiscal stimulus package. Senate Democrats blocked the progress of the nearly $2 trillion government rescue package for a second time. Currently, they are negotiating for stronger protections for workers and restrictions for bailed-out businesses.
The Fed says it will buy corporate debt to cushion the blow for businesses
The Federal Reserve said it would buy as much government-backed debt as it needed to keep financial markets functioning. The Fed also unrolled a series of programs meant to shore up both large and small businesses, in order to cushion the economic blow of coronavirus.
“Aggressive efforts must be taken across the public and private sectors to limit the losses to jobs and incomes and to promote a swift recovery once the disruptions abate,” the central bank said in a Monday morning statement, adding that “the Federal Reserve is using its full range of authorities to provide powerful support for the flow of credit to American families and businesses.”
The Fed resurrected an enormous bond-buying program — last used in response to the financial crisis — earlier this month. The Fed said it would spend $700 billion on Treasury securities and $200 billion in mortgage-backed debt. But on Monday, the central bank said it would not limit its purchases. Rather, they prefer buying “in the amounts needed to support smooth market functioning.”
Big Tech could emerge from COVID-19 outbreak stronger than ever
While the rest of the economy is tanking from the crippling impact of the coronavirus, business at the biggest technology companies is holding steady — even thriving.
Amazon said it was hiring 100,000 warehouse workers to meet surging demand. Mark Zuckerberg, Facebook’s chief executive, said traffic for video calling and messaging had exploded. Microsoft said the number of people using its software for online collaboration had climbed nearly 40 percent in a week.
People are now working from home and staying away from others in an attempt to slow the virus’s spread. As a result, the pandemic has deepened reliance on services from the technology industry’s biggest companies. It has also accelerated trends that were already benefiting them.
But beyond the biggest companies, it is more of a struggle. Communication tools like the videoconferencing service Zoom are now essential. Nevertheless, ride-hailing firms like Uber and Lyft and property-rental sites like Airbnb are seeing customers vanish.