Economists warn of Covid-19 resurgence

Washington: As more US States have started to partially reopen amid the Covid-19 pandemic, many economists have warned that moving too fast might risk a second wave of infections, which could have grave financial impacts. "If we get a second wave, it will be a depression," Xinhua news agency quoted Mark Zandi, chief economist of Moody's Analytics, as saying, defining the depression as 12 months or more of double digit unemployment.

"We may not shut down again, but certainly it will scare people and spook people and weigh on the economy," Zandi said. Philadelphia Federal Reserve Bank President Patrick Harker warned that reopening the economy too quickly would not only bring a 'health catastrophe' but also 'reverse the economic recovery'.

"In this less hopeful scenario, I project a similar growth path to the baseline for 2020, followed by a painful economic contraction of GDP (gross domestic product) in 2021 as shutdowns are reintroduced," he said at an event hosted by the Chicago Council on Global Affairs.

Michael Hicks, director of the Center for Business and Economic Research at Ball State University in Indiana, told Xinhua on Monday that a second wave of infections would be "very damaging to the economy".