WASHINGTON | The rebound of the american economy has begun faster than expected, said Jerome Powell, the president of the central Bank, in a speech prepared for a hearing Tuesday before a committee of the House of representatives.
“We have entered a new important phase and we have done earlier than expected,” he said, while stressing that the production and employment remained at levels very much lower than before the pandemic.
While since may, the first economy of the world is showing signs of improvement with a number of indicators that are ironed in the green, Jerome Powell judge the pace of recovery is “highly uncertain”.
It “will depend in large part of [our] success to contain the virus,” he stressed.
In addition, he says, a full recovery of the economy is “unlikely” as long as people do not have confidence in the fact that the pandemic is brought under control.
“The rhythm future will also depend on the political measures taken at all levels of government to bring relief (to households, businesses and local communities are most vulnerable) and to support the recovery as long as necessary”, he also commented.
In may, retail sales have registered a record increase, same thing for consumer spending, largely stimulated by government aid.
Economists fear that this rebound will not continue, so that the aid will dry up, and that new outbreaks of coronavirus emerged in the south-west of the country, including in California, Texas and Florida, populous States.
The Congress had adopted in late march, a huge plan of emergency aid of more than 2000 billion dollars, called the CARES Act, intended to mitigate the impact of the crisis on businesses and the american workers are the most vulnerable.
Jerome Powell urges for weeks, and lawmakers to vote on a plan to support the economy.
The House of representatives had adopted, in mid-may, a project of enormous help to some 3000 billion, but the Senate republicans demanded amendments before the review.
The monetary Fund expects a recession of 8 percent this year in the United States.
On Monday, Jerome Powell said that the contraction in GDP in the second quarter could be the worst in american history.