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Another wave of coronavirus surge in the US is seemingly dimming the outlook for the economic recovery ahead of next week’s Presidential election, economists polled by Reuters believed.

Key findings

“Nearly two-thirds of 58 economists who responded to an additional question in the Oct 16-26 poll said there was a high risk that the U.S. economic rebound could be halted by the surge in coronavirus cases, including five who said it was very high.

The result of the Nov. 3 US presidential election, if available promptly, could swiftly end the gridlock on a second fiscal stimulus bill.

Democratic control of the Senate, along with a win for the party’s presidential candidate Joe Biden, was predicted to yield a stronger near-term economic recovery, according to nearly 75% of 59 analysts who responded to an additional question.

Over 80%, or 41 of 49 respondents, said the US jobless rate would not return to pre-COVID-19 levels until 2023 at least, including two respondents who said it never would.

The wider poll showed the jobless rate averaging 8.3% this year, 6.8% next and 5.5% in 2022. It was 3.5% earlier this year before the pandemic took hold.

It is forecast to grow 4% this quarter after an expected record rebound of 31% last quarter.

For this year, the world’s largest economy is forecast to shrink 4%, according to the poll of 120 economists.

The consensus for 2021 and 2022 was for 3.7% and 2.9% growth, respectively.

Of the economists who expect more stimulus, the median was $1.8 trillion, within a $0.5-$3.5 trillion range.”