(Revised September 12, 2023)

We propose a method to allow usual business cycle models to account for the unusual Covid-19 recession and recovery. The pandemic and the public and private responses to it are represented by a new shock called the Covid shock, which loads onto wedges that underlie a subset of the usual shocks and comes with news about its evolution. We apply our method to a standard medium-scale model, estimating the loadings with 2020q2 data and the evolving news using professional forecasts. On net, the Covid shock is dominated by supply effects. It accounts for most of the early macroeconomic dynamics, was inflationary and a persistent drag on activity, and the majority of its effects were unanticipated.