The pace of economic improvement for the October-December quarter varied across regions and sectors; the growth rates of the United States and China were positive for two consecutive quarters while that of the European Union turned negative due to the tightening of public health measures following a resurgence of COVID-19.
Federal fiscal policy, taking into account both discretionary actions and so-called automatic stabilizers, was, on net, quite expansionary during the recession and early in the recovery. However, a substantial part of this impetus was offset by spending cuts and tax increases by state and local governments, most of which are subject to balanced-budget requirements, and by subsequent fiscal tightening at the federal level.