The US is officially in recession thanks to the coronavirus crisis | Jeffrey Frankel

The pandemic-induced collapse has brought a formal declaration faster than in 2008

On 8 June, the business cycle dating committee of the National Bureau of Economic Research declared that economic activity in the US had peaked in February 2020, formally marking the start of a recession. But we already knew that we were in a recession that had likely begun around that date. So, why does the NBER's formal declaration matter?

It is no secret that measures of employment fell sharply from February to March. Real (inflation-adjusted) personal consumption expenditure (PCE) and real personal income before transfers both peaked in February as well. Official measures of GDP are released only quarterly but the economic free-fall in late March was enough to pull first-quarter GDP growth down to an annualised rate of -4.8% (relative to the last quarter of 2019).

Related: US has officially entered first recession since 2009