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Unemployment set to rise further, but not as far as feared

Given the success of the government’s job furlough scheme and the signs of a strong initial rebound in economic activity we now think that the unemployment rate will peak later, in June 2021 rather than in July 2020, and at a lower rate of 7%, previously 8.5%. Even so, we still think that it will be many years before the unemployment rate returns to pre-pandemic level of 4%.

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