Video transcript
‘The Path Ahead Remains Highly Uncertain,’ Powell Says With economic recovery slowed by a resurgence of the coronavirus, Jerome H. Powell, the Federal Reserve chair, said the Fed would leave interest rates at near-zero and continue making large bond purchases. My colleagues on the FOMC and I kept interest rates near zero and maintained our sizable asset purchases. These measures, along with our strong guidance on interest rates and our balance sheet, will ensure that monetary policy will continue to deliver powerful support to the economy until the recovery is complete. The path of the economy continues to depend significantly on the course of the virus. A resurgence in recent months in Covid-19 cases, hospitalizations and deaths is causing great hardship for millions of Americans, and is weighing on economic activity and job creation. Following a sharp rebound in economic activity last summer, the pace of the recovery has moderated in recent months, with the weakness concentrated in the sectors of the economy most adversely affected by the resurgence of the virus and by greater social distancing. The overall recovery and economic activity since last spring is due in part to federal stimulus payments and expanded unemployment benefits, which have provided essential support to many families and individuals. The recently enacted Coronavirus Response and Relief Act will provide additional support. Overall, economic activity remains below its level before the pandemic, and the path ahead remains highly uncertain. While we should not underestimate the challenges we currently face, several developments point to an improved outlook for later this year. Sufficiently widespread vaccinations would enable us to put the pandemic behind us, and return to more normal economic activities. In the meantime, continued observance of social distancing measures and wearing masks will help us reach that goal as soon as possible. The economy is a long way from our employment and inflation goals, and it is likely to take some time for substantial further progress to be achieved.
With economic recovery slowed by a resurgence of the coronavirus, Jerome H. Powell, the Federal Reserve chair, said the Fed would leave interest rates at near-zero and continue making large bond purchases. Credit Credit… Al Drago for The New York Times Wall Street suffered its sharpest daily decline in months on Wednesday as investors awaited a number of earnings reports from large technology companies and as the Federal Reserve issued a glum assessment of the economy.
The S&P 500 and the Nasdaq Composite indexes fell 2.6 percent. The Dow Jones industrial average fell 2 percent.
After the S&P 500 rallied more than 16 percent in 2020, hitting record after record despite the economic damage caused by the pandemic, investors have grown…