According to Powell, the Fed needs to have things under control, until the management decides it’s no longer necessary. “You may also find out that you can do more,” said Powell in House of Representatives on Wednesday.
Economic recovery may take some time. Powell said that interest rates will have to remain close to zero for a longer period than usual. Powell also reassured that the Fed will continue in bond purchases to ensure that resources for financing of investment and government expenses will remain cheap as long as necessary.
Yet, Powell reminded that lawmakers will have to cooperate so that the economy recovers sooner. He suggested that the Congress should prolong the period of extraordinary unemployment benefits of $600 per week, which should end in July. He also pointed out that smaller businesses will need some help.