U.S. Macroeconomic Pulse. April 2020

Baseline assumes GDP declines by 4.4% in 2020. GDP returns to pre-crisis levels by 2Q22. Peak unemployment rate could surpass 15%. With inflation headwinds building we expect CPI to drop by 0.1% in 2020.

Key points

• Key points:
• Fed to keep rates at the Zero Lower Bound, balance sheet to grow to $7.5tn
• Long-term yields to remain close to current levels by year-end
• Oil prices to remain low in 2020
• Uncertainty remains over the depth and duration of the crisis
• Risks tilted to the downside

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