The rear-view mirror continues to show that the US economy is clawing back losses from the coronavirus gut punch in the spring. But the rebound is increasingly threatened by the re-acceleration of Covid-19 cases, fatalities, and hospitalizations.

The daily change in US coronavirus cases shot up to nearly 122,000 yesterday (Nov. 5), a new record, based on numbers compiled by Johns Hopkins University. In several states, new restrictions have been announced or are under consideration to slow the spread of the disease. New Jersey Governor Phil Murphy, for example, says the state is “close” to rolling out new restrictions. As these restrictions are imposed (or re-imposed) around the country, the economy faces new headwinds.

The trend in cases has yet to trigger a commensurate surge in fatalities and hospitalizations, but in both cases, the trends don’t look encouraging. The daily change in new deaths rose to a seven-week high yesterday.

Meanwhile, new hospitalizations are steadily rising and have returned to levels last seen during the summer peak.

These are worrisome changes, all the more so as winter approaches and day-to-day activity overall moves indoors — a higher-risk situation for coronavirus spread.

It doesn’t help that the economic recovery in some corners has been weak, which leaves the US in a vulnerable condition if coronavirus blowback continues to accelerate.

At the top of the list for macro warning signs is the unusually high weekly increases in jobless claims. Yesterday’s update shows that new filings for unemployment benefits slipped to a new pandemic low – 751,000 for last week. Although that’s far below levels reported in the depth of the crisis earlier this year, new layoffs of three-quarters of a million workers – week after week – still exceeds the losses reported at the worst point in every recession since 1970. In short, these numbers continue to reflect a high risk for the labor market, which is the foundation for consumer spending and thereby the economy overall.

“Bottom line, overall the labor market continues to repair itself but the pace at which it is doing so is slowing down,” says Peter Boockvar, chief investment officer at Bleakley Advisory Group.

Adding to the threat is the end-of-year expirations of pandemic policies intent on helping the unemployed. “There are simply not enough jobs being created to support all of the workers running out of aid before the end of 2020,” warns Andrew Stettner, a senior fellow at The Century Foundation. “We urgently need action before the holiday season.”

The good news is that the overall economic numbers published to date still reflect a recovery in progress. But the pace of the rebound is slowing. That’s not surprising – the big gains came early on in the initial stages of the bounce-back when the economy was reopened for the first time in the summer. The record increase in third-quarter GDP, which rose 33.1% after Q2’s record 31.4% decline (based on annualized rates) – is encouraging, but the pace of recovery, inevitably, is decelerating.

The Atlanta Fed’s GDPNow estimate for Q4, for instance, points to a 3.2% increase (as of Nov. 4). But it’s still early in the quarter and with coronavirus risk rising and jobless claims still running unusually high the recovery’s momentum faces challenges in the weeks and months ahead.

“I think the risks are pretty high here that the economy backtracks,” predicts Mark Zandi, chief economist of Moody’s Analytics. “We are suffering a very significant reintensification of the virus… that’s going to start doing some damage.”

To monitor the risk, keep a close eye on two real-time multi-factor economic indicators that track the broad US macro trend: the Philly Fed’s ADS Index and the New York Fed’s Weekly Economic Index (WEI). ADS offered an early sign in the spring that a strong recovery was unfolding after the initial coronavirus crash. Recent updates of ADS show that the growth momentum is slowing but, so far, remains well above a level that marks a warning sign.

WEI, by contrast, remains deep in recession territory, although that’s largely due to the index’s design to track a longer-run and slower-moving trend profile of the economy. The key message via WEI, however, is that the index has been recovering, albeit by posting lesser degrees of negative readings.

It’s unclear how much blowback the economy faces from a new wave of coronavirus but it’s likely that there will be a price to pay. The big question: Will the US slip back into a recession? Too early to say, and too early to rule out the possibility.

If a new phase of contraction becomes a high-probability risk at some point, the ADS Index will likely dispense an early warning sign. For the moment, that risk appears low, but in the current climate, a few weeks (or even days) can tip the scales dramatically. The potential for deeply negative surprises, in short, remains high for the foreseeable future.