Fed’s Powell warns coronavirus will cause prolonged recession
FOX Business’ Edward Lawrence on Federal Reserve Chairman Jerome Powell’s comments on coronavirus’ economic impact.
Get all the latest news on coronavirus and more delivered daily to your inbox. Sign up here.
Continue Reading Below
It will likely take more than just a few months before the millions of Americans who have lost their jobs on fallout from the coronavirus pandemic will be able to get back to work, San Francisco Federal Reserve Bank President Mary Daly said on Wednesday.
FED'S POWELL SAYS US ECONOMY MAY NEED MORE POLICY HELP TO AVOID 'PROLONGED RECESSION'
With states reopening in phases, that “by definition translates to a slow recovery as we put toes in the water, see if the virus flares up when we go back to some economic activity,” she said in an interview on the SiriusXm program “Wharton.” “If it doesn’t, we can gain some momentum, people will be more confident; but if it does then people are going to be more cautious and that will slow the recovery even further.
FED'S POWELL RULES OUT NEGATIVE INTEREST RATES, DESPITE TRUMP PRESSURE
“Whichever scenario occurs, this is going to be a slow recovery and not a sharp rebound,” she said.
The San Francisco Bay Area, where Daly lives, was the first U.S. region to impose stay-at-home orders in mid-March. In recent weeks most states, including most of California, have begun to allow businesses to phase in some reopenings, hoping to bring back to work some of the more than 30 million Americans who have filed for unemployment insurance benefits over the last two months.
CLICK HERE TO GET FOX BUSINESS ON THE GO
Getting people back to work is “a project that will last longer than just a few months,” Daly said. And with the rate of the virus spread controlling how quickly regions will be able to reopen, she said, under most scenarios “the economy is going to need more support, in all likelihood.”
Her remarks echoed those of Fed Chair Jerome Powell who earlier in the day said more fiscal support from the U.S. Congress is likely worth the cost if it helps the economy avoid long-term damage.
CLICK HERE TO READ MORE ON FOX BUSINESS
Source: Read Full Article