An uptick in U.S. jobless claims this week is a reminder there's still a real risk of permanent job loss that could spike credit defaults and weigh down economic activity.
The expiration of the $600 weekly unemployment bonus and the potential for large employers to use COVID-19 uncertainty as cover for workforce reductions represent a meaningful headwind to the gross domestic product, and it remains to be seen if spending growth associated with robust home sales (a record monthly increase in June) and unprecedented monetary and fiscal stimulus can offset it.
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