It is the service sector that is most affected by shutting down the economy.
The final piece of data for the first month of the fourth quarter will be released this week when the trade deficit data becomes available. The data for October did not reflect the impact of the surge in the virus as the November data will. It is difficult to forecast economic growth for the next two quarters given the spread of the virus. It is a matter of how much the service sector of the economy will be closed with stay at home orders, such as what has been done in Michigan. The service sector of personal consumption expenditures represents approximately 42% of total Real GDP. Spending in this sector dropped by 41.8% in the second quarter and 9.9% in the first.
PROBANK AUSTIN ADVISOR - NOVEMBER 30, 2020