The US economy is growing at its fastest pace since 1984

The International Monetary Fund projects the US economy to grow 6.4% this year, up 1.3 percentage points from the group's forecast in January. It expects the global economy to expand 6% in 2021. CNN's Clare Sebastian reports

Posted: Apr 7, 2021 11:11 AM
Updated: Apr 7, 2021 11:11 AM

President Joe Biden's $1.9 trillion stimulus package will boost the US economy and drive faster global growth this year, the International Monetary Fund said Tuesday, though it warned that many countries continue to suffer from the pandemic and are at risk of being left behind.

The US economy will surpass its pre-pandemic size as growth reaches 6.4% this year, the IMF said, up 1.3 percentage points from the group's forecast in January. The rebound will help the global economy expand 6% in 2021, an upgrade of 0.5 percentage points from the IMF's previous outlook. The estimates are broadly in line with Wall Street's expectations.

"At $1.9 trillion, the Biden administration's new fiscal package is expected to deliver a strong boost to growth in the United States in 2021 and provide sizable positive spillovers to trading partners," the IMF said in a report. Other governments and central banks around the world have also pumped trillions into the global economy.

The IMF said the "unprecedented policy response" to the pandemic means the "recession is likely to leave smaller scars than the 2008 global financial crisis." The group estimates global output dropped 3.3% in 2020, while the US economy shrunk 3.5%.

There are already signs the US recovery is gaining speed. American employers added 916,000 jobs in March, the biggest gain since August. The US manufacturing sector is also roaring ahead, with the ISM Manufacturing Index recently posting its best reading since 1983.

The IMF expects that the coronavirus vaccine rollout and massive government stimulus will combine this year to produce the fastest annual growth rate in the United States since 1984 under President Ronald Reagan. But many other countries will have to wait until 2022 or 2023 to recover all the output lost during the pandemic. Global output growth will slow to 4.4% next year, according to the IMF.

"Multispeed recoveries are under way in all regions and across income groups, linked to stark differences in the pace of vaccine rollout, the extent of economic policy support, and structural factors such as reliance on tourism," said Gita Gopinath, director of research at the IMF. "The divergent recovery paths are likely to create significantly wider gaps in living standards between developing countries and others."

The upgraded US forecast means the world's biggest economy is on track to grow more quickly than many other developed nations this year. The IMF expects growth of 4.4% in the 19 countries that use the euro as Europe battles another wave of coronavirus that has forced Germany, France and Italy to tighten restrictions. Output is expected to expand 3.3% in Japan.

But some nations in Asia will still outpace the United States. The IMF expects China, which was the only major economy to avoid recession last year, to grow 8.4% in 2021 — much stronger than the country's official forecast of more than 6%. Output in India will expand 12.5% in the fiscal year to March 2022.

The IMF credited continued government stimulus and vaccine rollouts for stronger growth projections. It said that consumer prices could be volatile, but it does not expect high levels of inflation to take root because of weak wage growth and unemployment.

Still, the IMF cautioned that a "high degree of uncertainty surrounds" its projections, reflecting the wide range of potential coronavirus developments. "Greater progress with vaccinations can uplift the forecast, while new virus variants that evade vaccines can lead to a sharp downgrade," the group said in its report.

While advanced economies were hit harder than developing nations by fallout from the 2008 global financial crisis, the IMF expects the opposite to be true in the pandemic. The group also said that young people, women and lower-skilled workers have been more likely to lose their jobs due to coronavirus.

"Once the health crisis is over, policy efforts can focus more on building resilient, inclusive, and greener economies, both to bolster the recovery and to raise potential output," said Gopinath.

While stimulus has helped protect the economy and financial system, it has also encouraged investors to take excessive risks and driven up asset prices, the IMF warned in a separate report. If interest rates rise sharply in response to inflation, that could lead to tighter financing conditions.

The fallout would hit developing markets and poorer countries hardest.

"There is a risk that financial conditions in emerging market economies may tighten markedly, especially if policymakers in advanced economies take steps toward policy normalization," said the IMF.

Mississippi Coronavirus Cases

Data is updated nightly.

Cases: 319115

Reported Deaths: 7353
CountyCasesDeaths
DeSoto22246264
Hinds20612421
Harrison18342316
Rankin13855282
Jackson13666248
Madison10213224
Lee10050176
Jones8452167
Forrest7810153
Lauderdale7253242
Lowndes6488149
Lamar632288
Lafayette6295120
Washington5412136
Bolivar4833133
Panola4659110
Oktibbeha465898
Pearl River4591146
Marshall4571105
Warren4436121
Pontotoc424573
Union415576
Monroe4154135
Neshoba4059179
Lincoln4007111
Hancock385187
Leflore3514125
Tate342386
Sunflower339391
Pike3366110
Alcorn323272
Scott319274
Yazoo313971
Adams304785
Itawamba304777
Copiah299666
Coahoma298283
Simpson297889
Tippah291168
Prentiss283361
Leake271674
Marion271280
Covington266683
Wayne264442
Grenada264087
George251851
Newton248563
Tishomingo230867
Winston229881
Jasper222048
Attala214973
Chickasaw210459
Holmes190374
Clay187454
Stone187233
Tallahatchie179941
Clarke178980
Calhoun173732
Yalobusha167740
Smith164034
Walthall135147
Greene131633
Lawrence131024
Montgomery128643
Noxubee127934
Perry126638
Amite125942
Carroll122330
Webster115032
Tunica107927
Jefferson Davis107633
Claiborne102930
Benton102225
Humphreys97533
Kemper96628
Franklin84923
Quitman81816
Choctaw79018
Wilkinson69332
Jefferson66228
Sharkey50817
Issaquena1696
Unassigned00

Alabama Coronavirus Cases

Cases: 547323

Reported Deaths: 11266
CountyCasesDeaths
Jefferson808021563
Mobile41925826
Madison35600522
Tuscaloosa26136458
Shelby25554254
Montgomery25067610
Baldwin21774313
Lee16234175
Calhoun14692325
Morgan14614285
Etowah14132361
Marshall12443230
Houston10748287
Elmore10295212
Limestone10180157
St. Clair10146250
Cullman9921200
Lauderdale9582248
DeKalb8955189
Talladega8441184
Walker7318279
Autauga7215113
Blount6925139
Jackson6900113
Colbert6394139
Coffee5616126
Dale4928114
Russell454441
Chilton4461116
Franklin430683
Covington4263122
Tallapoosa4117154
Escambia400280
Chambers3715123
Dallas3604156
Clarke352861
Marion3231106
Pike313978
Lawrence3121100
Winston283372
Bibb267364
Geneva256981
Marengo250565
Pickens236562
Barbour234559
Hale226578
Butler223371
Fayette217162
Henry193843
Cherokee187245
Randolph186844
Monroe179141
Washington170339
Macon163051
Clay159559
Crenshaw155057
Cleburne152543
Lamar145837
Lowndes141953
Wilcox127030
Bullock124242
Conecuh112930
Coosa111129
Perry108726
Sumter105732
Greene93434
Choctaw61725
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