US economy will shrink $8 trillion because of COVID-19, CBO says

The Congressional Budget Office predicts that financial fallout from the COVID-19 pandemic will slim the U.S. economy by about $8 trillion over the next decade, according to The Washington Post

The projections were outlined in a June 1 letter to Senate leaders. CBO said the U.S. economy will see $7.9 trillion less growth from 2020-30 than was projected in January. The Washington Post said that decrease represents a 3 percent decline in gross domestic product compared to previous estimates. 

The CBO said reduced consumer spending and the closing of several businesses is what will most hamper the U.S. economy. The more than $2 trillion the federal government approved for emergency spending will offset some of the effects, according to the Post.

View the full letter here. Note that while the CBO says "nominal" GDP will fall by $16 trillion over the next decade, "real" GDP will decrease by about $8 trillion. Economists view the "nominal" measure as less significant as it doesn't include inflation.

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