Philip Bunn, David E. Altig, Lena Anayi, Jose Maria Barrero, Nicholas Bloom, Steven Davis, Brent Meyer, Emil Mihaylov, Paul Mizen, Gregory Thwaites, 16 November 2021

The onset of the COVID-19 pandemic triggered a massive spike in uncertainty. This column uses data from panel surveys of US and UK business executives to document how uncertainty over own-firm sales growth rates over the year ahead roughly doubled in reaction to the shock. Firm-level uncertainty receded after spring 2020 but remains much higher than pre-COVID levels. The nature of this uncertainty has shifted greatly since the pandemic struck, from an enormous widening in perceived downside risk to a sharp increase in upside risk. Economic uncertainty associated with the pandemic has morphed from a tale of the lower tail into a tale about the upper tail.

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