The Chairman of the US Federal Reserve (Fed), Jerome Powell, on May 17, while sharing his views on the economic condition of America in the future, claimed that by the second half of the year, the US market would start recovering steadily.
But he also mentioned that the market recovery would totally depend on the US Government’s measure to tackle the risk of COVID-19.
The US government has already taken some measures like it changed the funding rate of the Fed to 0 percent, massive liquidity measures have been taken and in April the Fed passed $2.2 trillion stimulus package. Now, Powell has attached his hopes with all these measures and believes that all these measures would help the government in dealing with the crisis.
At the same time, Powell also mentioned that the might take time to get recovered, say, by the end of 2021.
Some other measures taken by the Fed, like programs for additional lending emergency and expanded asset purchasing would also help the market in its steady recovery.
Powell mentioned that like the central bank of Europe, the US would not incorporate negative interest rates in its market.
In the year 2014, when some of the European countries were dealing with the debt crisis, the ECB added this negative interest rate to push inflation and economic activities.
The Chairman of the US Federal Reserve further explained that if the local government would get the support of the US Congress then the market situation might get improved. Later, when Powell was asked about the future of reopening the US economy, he did not give a clear answer to that.
As per the report, recently, the House of the representatives have passed a $3 trillion stimulus package. But according to some twitter users, the financial stimuli might provide help immediately at the time of crisis. But it would also reduce the value of the dollar for a longer period of time.
Articles You May Read.