US economic recovery 'may be stuttering' amid Covid-19 upsurge     

Fall in consumer footfall and an increase in jobless claims have made some experts fear the economic recovery in the US has going in reverse

Picture: Johannes Eisele EISELE/AF  Getty Images

The economic recovery in the US may be stuttering as the country struggles to contain a renewed outbreaks of Covid-19, a senior economist has said. 

Citing the first increase in initial jobless claims since late-March, Michael Pearce at Capital Economics in New York said that fears have increased that recovery has started to go into reverse. 

"While we wouldn’t read too much into the uptick in claims, to 1.42 million from 1.31 million, the bigger concern is that initial claims have been broadly flat for the past month, at a level more than double the peak seen in the 2008-2009 recession," Mr Pearce said. 

"That suggests job losses have remained elevated as the initial strong wave of rehiring slows," he said. 

There are other figures that suggest that the recovery hasn't gone into reverse, however.

"Consumer footfall was largely unchanged again last week. Meanwhile, the OpenTable restaurant data, air travel figures from the TSA and hotel occupancy rates have been relatively stable over the past few weeks," Mr Pearce said.  

"In all three cases, the average levels for July so far are higher than in June, consistent with a further modest rise in consumption this month," he said. 

Fears about a surge in Covid-19 cases in the US weighed on global stock markets and the dollar in recent days.