PARIS, France – The United States and eurozone economies will see massive contractions this quarter of up to 30% on an annualized basis and a recovery to pre-coronavirus crisis levels will not come before the end of 2021, ratings agency Fitch said on Thursday, April 2.
"We now judge that lockdowns could reduce GDP (gross domestic product) across the EU and US by 7% to 8%, or 28% to 30% annualized" in April through June, Fitch said in a statement.
GDP is a measure of all economic output in a country.
Fitch said that if the health crisis eases in the second half of the year, a marked rebound could be expected with the lifting of lockdowns leading to a jump in activity.
Government stimulus measures could also help boost growth.
"But the scale of the dislocation means that even assuming that the health crisis subsides we do not envisage GDP returning to pre-virus levels until late 2021," said Fitch.
Fitch said it expects US unemployment to peak at 10% this quarter with 10 million job losses.