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Weekly economic review & outlook And so it begins

March 30, 2020

You Need to Know

Week in review

Unemployment claims skyrocket to record levels

Weekly unemployment claims surged to a record 3.28 million, well above the prior record of 695,000 in 1982.

Equity markets rebound, heartened by the federal government stimulus bill and Fed policy

After several weeks of huge declines, equity markets rebounded sharply in response to the federal government’s stimulus bill and Federal Reserve market liquidity enhancements.

Week Ahead


A weaker, but not terrible, employment report for March

The surveys for the March employment report were for the week before the job market essentially closed, so the job/unemployment numbers shouldn’t look too bad yet.

The ISM surveys expected to fall into contraction territory

The shutdown in large parts of the economy in the second half of March suggests that the ISM surveys will drop into contraction territory for March.

Nothing better illustrates the sudden downshift in the economy than weekly unemployment claims. For the week ending March 14, claims rose by 70,000 to 282,000 – the highest level since September 2017. While this was a large weekly gain, it wasn’t that unusual nor was the higher level of claims consistent with recession. But last week we got the weekly claims data for the week ending March 21, and they skyrocketed to 3.28 million. By way of comparison, with data back to the beginning of 1967, the highest level of claims was 695,000 during the severe 1982 recession. Last week’s number was literally off the charts – and it may even have understated the shock, as there are reports that several states were unable to fully process all the new claims. They will be seen in this week’s claims data.