After a traumatic spring, this summer gave glimpses of a return to normal life: Restaurants reopened, outdoor parties were thrown, and many families even took vacations. But with unemployment elevated and many sectors unable to return to their pre-COVID business models, the U.S. remains a recovering economy, not a recovered one.

Growth in the third quarter is shaping up to be strong, and rehiring is continuing at an encouraging pace, setting the stage for above-trend growth in the year ahead. Even so, until the virus is contained, we will continue to hold lower expectations for economic activity. The key risk to the outlook is a resurgence in infections that leads to renewed lockdowns or renewed fear that keeps consumers at home.

Key Economic Indicators

USEO - September 2020 - Chart 1