The United States has again recorded its worst GDP downturn in the second quarter despite May and June rebound.The coronavirus pandemic has yet again demonstrated how damaging its effect is to the international market as U.S. gross domestic product (GDP) took a sharp recession in the next quarter. However with all the nonstop reports of fresh COVID-19 ailments, company closures, in addition to the expiration of unemployment benefits, it looks like that the U.S. market is currently in free-fall.Q2 U.S. GDP shrinks by 33%On Thursday, July 30, that the Commerce Department reported the worst GDP decrease from the U.S.’s history using an annualized rate of 32.9% in the next quarter. The fall marked the most significant slump because the 1940therefore, as stated by the economists.The historic fall is believed to reflect the weeks once the nation was under strict lockdown to include the spread of coronavirus. At the first quarter, the US market shrunk by 4.8% before the current downturn as well.The Bank of America at mid-July, nevertheless, reported that an uptick in customer spending which prompted an upward tendency in May and June. The advancements in the initial two weeks of the next quarter direct that the bank’s analysts to announce the U.S. market has entered a “healing phase.”Nevertheless the small bounce-back wasn’t sufficient to offset the loss incurred from the pandemic. In reality, economists had forecasted a “35% annualized drop,” according to Bloomberg‘s data.It implies the true GDP figures may seem worse than what they’re. According to economists, a 35% annualized rate implies the market is 10% smaller compared to the initial weeks of 2020.Economic prognosis may have worseDespite the present scenario, economists polled by Bloomberg anticipate that from the next quarter, the U.S. GDP will grow up to 18%.On the flip side, some view the U.S. market falling farther as crucial lifelines such as the extra $600 yearly unemployment benefits are about to die. ING Financial Markets chief global economist James Knightley, for example, stated that numerous blows could knock on the GDP to diminish further.In a statement quoted by Bloomberg, he clarified:“One is the fear factor from Covid-19 on the rise and how that changes people’s behavior. Secondly, you got unemployment rising because states are reversing course on their reopenings. And then, third, you have the income squeeze.”California earlier this month purchased all indoor companies to shut again after the abrupt growth in new coronavirus disease in the nation. Governor Newsom implemented stricter steps too in a bid to include community transmission.Bloomberg economists stated the situation involves another or continuation of financial aids. In accordance with these, “augmented unemployment benefits” are critical for keeping the economy afloat—especially with delicate consumer spending patterns and reduced income.Featured picture courtesy of Energepic.com/Pexels, Bureau of Economic AnalysisMicky is a news website and doesn’t offer trading, investment, or other financial information. By using this site, you confirm that you have read and agree to abide by our Terms and Conditions.Micky subscribers – you can find a 10% discount on trading charges on FTX and Binance if you register with the links above.