The United States economy is said to be far from fully recovering from the effects of the coronavirus crisis. The central bank’s monetary policy will therefore need to support it for some time to come. Federal Reserve Governor Jerome Powell said so on Tuesday.
“The economy is on a long road to our goals of both unemployment and inflation. It is likely that it will take some time to make significant progress,” Jerome Powell said during a reading of the economic status report before the US Senate Banking Committee.
According to Powell, the financial system was greatly helped by the central bank’s $120 billion purchase of government bonds, as well as virtually zero base interest rates. The Fed chief acknowledged that the health-care crisis is being managed, and a major improvement could come in the coming months of this year, but that the United States will rise much longer economically. “It will depend very much on when the spread of the virus is severely reduced,” he added.
Powell even supported the $1.9 trillion fiscal package proposed by new US President Joe Biden. “Don’t take your foot off the gas,” the Fed governor appealed to U.S. lawmakers.
