Jay Powell has said the US economy is at an “inflection point” with growth and recruitments expected to accelerate, but he warned that further surges in Covid-19 could hamper the recovery.
Speaking on CBS 60 minutes program, the Federal Reserve Chairman delivered an optimistic message on the economic outlook and stressed the critical importance of the current vaccination campaign and the massive stimulus measures adopted to date to maintain momentum.
“We feel like we’re in a place where the economy is about to start growing a lot faster and job creation is happening a lot faster,” he said in a brief excerpt from the interview, which was conducted Wednesday and airs in full on Sunday.
“What we’re seeing right now is really an economy that seems to be at an inflection point, and that’s because of widespread immunization and strong budget support, strong policy support. monetary, ”he added.
The U.S. vaccination schedule has been one of the fastest in the world, with a record 4.6 million doses administered on Saturday, according to Bloomberg data. Doctors hope enough vaccines will soon be issued to slow the spread of the disease and crush the number of cases, as has started to happen in Israel and the UK.
In the short term, however, officials in the Biden administration are concerned about the spread of the disease in some states such as Michigan, where the number of daily cases recently reached record highs as unvaccinated young people begin to socialize more and catch the virus.
Powell also reiterated on Sunday that the improving economic outlook rests primarily on keeping Covid-19 under control.
“The main risk to our economy right now is really for the disease to spread again,” he warned. “It will be smart if people can continue to distance themselves socially and wear masks.”
Fed officials have so far argued that, despite the vastly improving outlook for growth and inflation, the US economy has yet to fully recover. While the March jobs report showed strong increases, the unemployment rate is still high at 6 percent, and there is 8m fewer jobs than before the outbreak of the coronavirus crisis.
Minutes of the last central bank meeting on monetary policy, published Last week, he also clarified that the Fed had no plans to withdraw its ultra-accommodative monetary policy anytime soon. Officials stressed that it would take “some time before further substantial progress” is made on its full employment and inflation targets, which average 2 percent over time.
As such, they have indicated no plans to adjust the current $ 120 billion monthly asset purchase program, nor any intention to raise interest rates until at least 2024, as their current forecast to suggest.