US may be in recession says Federal Reserve chief Powell
WASHINGTON: The US "may well be in recession" but progress in controlling the spread of the coronavirus will dictate when the economy can fully reopen, Federal Reserve chair Jerome Powell said yesterday in an interview on NBC's Today Show.
"We are not experts in pandemic... We would tend to listen to the experts. Dr Fauci said something like the virus is going to set the timetable, and that sounds right to me," Mr Powell said, in reference to Dr Anthony Fauci, head of the National Institute of Allergy and Infectious Diseases who is on the White House's coronavirus task force.
"The first order of business will be to get the spread of the virus under control and then resume economic activity."
The US central bank chief's remarks are a contrast to the urging by some of President Donald Trump's advisers for a faster reopening. The president himself has said he wants the economy to be "roaring" by Easter, in a little over two weeks.
Fed officials who have spoken on the issue, now including Mr Powell, have taken a more sombre approach, focusing on the need to first control the virus, then restore confidence among workers and consumers that it is safe to go back to business.
Mr Powell's remarks yesterday were an unusual acknowledgement by a Fed chair that the economy may be contracting even before data has confirmed it. But the situation is so unusual - with upcoming reports expected to show such large jumps in joblessness and lost output - that policymakers have become unusually blunt, and focused on making the contraction a short one.
The US death toll from the coronavirus approached the milestone of 1,000 yesterday as hospitals in New York and other hot spots struggled to treat a flood of patients and the US Congress neared approval of US$2 trillion (S$2.9 trillion) in aid to counter the pandemic's economic impact.
As of 1am Thursday (1pm Thursday, Singapore time), 999 people had died of the respiratory illness caused by the virus, according to a Reuters tally of reports from state and local officials.
One-third of those deaths were in New York state, where the governor has warned hospitals could soon run out of beds and ventilators. The state accounted for nearly half the national total of some 68,000 cases. - REUTERS