Economic week ahead
Second quarter GDP numbers from the US and the European Union are expected to give a brutal insight into the damage wrought by lockdowns. After a 5pc drop in the first quarter, analysts expect American output to plunge 33pc for the three months to the end of June – one of its biggest ever quarterly falls. After EU leaders agreed the €750bn (£680bn) recovery fund, the GDP reading for the second quarter is not likely to be pretty. Analysts estimate a contraction of around 30pc. On Thursday, the EU and Germany will issue their latest rounds of unemployment figures. Germany has seen jobless claims rise sharply since March, up to 6.4pc in June. US Federal Reserve chairman Jay Powell has already made it clear that the central bank is in no rush to raise interest rates from their record low of 0.25pc, but also ruled out taking rates into negative territory. No policy changes are expected at this week’s meeting on Wednesday. But the FOMC will likely have concerns about the recent resurgence of virus cases stymying the economic recovery.