Fed’s Kaplan: Virus can be managed without another shutdown if all wear masks

During an interview with Bloomberg TV on Monday, Dallas Federal Reserve Bank President Robert Kaplan said that he believes the coronavirus can be managed without another shutdown if all wear masks.

Key quotes

“US economy expected to contract in 2020 at about 4.5% to 5%.”

“Unemployment rate expected to end the year at about 9% or 10%, unless can manage virus better.”

“Expecting to see an extension in some form of unemployment benefits; if not, would see a further economic weakening.”

“Do not see in the data that the extra $600 weekly for unemployed was making it harder for businesses to hire.”

“Would not want to change the Fed’s forward guidance to target higher-than-2% inflation.”

“Would prefer to tie any future forward guidance to employment, or to both inflation and employment.”

“Hope to get further feedback on the Main Street Lending so that the program can be used more.”

“The Fed should be cognizant, concerned about the Fed’s impact on asset prices; important that the Fed’s programs have a sunset date.”

Market reaction

The US Dollar Index edged higher in the last minutes and was last seen gaining 0.5% on a daily basis at 93.93.