U.S. economy contracts 3.5 pct in 2020 amid COVID-19 fallout

The U.S. economy contracted 3.5 percent in 2020 amid COVID-19 fallout, the largest annual decline of U.S. gross domestic product (GDP) since 1946, according to data released by the U.S. Commerce Department on Thursday.

The data also showed that the U.S. economy grew at an annual rate of 4 percent in the fourth quarter of 2020 amid a surge in COVID-19 cases, slower than 33.4 percent in the previous quarter.

"The increase in fourth quarter GDP reflected both the continued economic recovery from the sharp declines earlier in the year and the ongoing impact of the COVID-19 pandemic, including new restrictions and closures that took effect in some areas of the United States," the department said in a statement.

Despite a partial economic rebound in the second half of last year, the U.S. economy shrank 3.5 percent for the whole year of 2020, compared with an increase of 2.2 percent in 2019, according to the department.

"Over the past year, the economy contracted 10 percent in the first half of the year and made up three-quarters of that decline in the second half," Jason Furman, professor at Harvard University and former economic adviser to President Barack Obama, said on Twitter.