The IHS Market report for May released Thursday clearly indicates that the U.S. economy contraction reached a peak in April. Both manufacturing and services rose but are still well below 50, meaning contraction is still occurring, but is easing.
With states backing off restrictions for everyone to go back to work, the numbers will continue to improve. When the economy finally returns to expansion is unknown. How much damage the shutdown caused will only be revealed after months of being fully opened. No one has any estimates on which businesses have shut their doors forever. There will be many lost businesses.
Expect a slow recovery and maybe by the fourth quarter growth will return.
Next year, everything being equal, the economy should be running on extraordinary loose money. That should return us to high economic growth, barring another violent breakout of new coronavirus victims. That is extremely unlikely.
The stock market appears to be predicting a return to good times.
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