The virus will likely dampen U.S. economic growth in the first quarter, according to a survey of economists by The Wall Street Journal.
In a survey of economists, 83 percent expected the coronavirus outbreak will have a small impact on U.S. gross domestic product growth from January to March, or less than 0.5 percentage point.
Just 5 percent expected a bigger reduction and 10 percent say no impact.
The thought is that Europe and Asia will take the brunt of the impact and that the U.S. is more insulated.
China has stated it will take steps to stabilize its economy by controlling the virus and offering measures like tax relief domestically.
Fed chair Jerome Powell said Tuesday the Fed is monitoring developments stemming from the coronavirus, which he said "could lead to disruptions in China that spill over to the rest of the global economy."
In response to lawmakers' questions, Powell said it was too early to assess the threat the virus poses to the U.S. economy but he noted that the U.S. economy "is in a very good place" with strong job creation and moderate growth.
White House trade adviser Peter Navarro said it was too early to know what kind of impact the outbreak will have on the economy.
The outbreak has caused U.S. companies to halt or drastically reduce operations in China and led to the grounding of flights between the two countries.
“I think we are going to have to wait another couple of weeks or a month to see just what exactly is going on,” Navarro told FOX Business’ Maria Bartiromo.
“There’s also companies that are going back to work in China as we speak. We won’t know for a couple of weeks now whether the virus is going to peak or whether it’s going to spread.”
There are certain sectors that are more exposed such as travel and tourism.
It is also one more event that is having an impact on Boeing as it deals with its own 737 Max grounding issues.
Most economists, 81 percent, expected the 737 MAX production stoppage to have a small effect on U.S. GDP growth in the January to March period, while 15 percent said it would have a significant impact.
The U.S. economy grew 2.3 percent in 2019.
The economists in the WSJ survey expected that pace to slow to 1.9 percent in both 2020 and 2021.