Fed’s Powell: US moving with alarming speed toward very high unemployment

The United States is moving with alarming speed toward very high unemployment, FOMC Chairman Jerome Powell said in his prepared remarks delivered at an online event hosted by the Brookings Institution on Thursday. However, Powell further noted that high unemployment was expected to remain temporary.

Key takeaways

“Measures to contain coronavirus outbreak are an essential investment in individual, collective health.”

“We should do everything we can to provide relief for those suffering for the public good.”

“Fed can provide some relief, stability now and use tools to ensure eventual recovery is as vigorous as possible.”

“Fed is deploying emergency lending powers to an unprecedented extent, with financial backing from US Congress, Treasury.”

“Fed will use lending powers forcefully, aggressively, proactively until recovery on a solid footing.”

“Many borrowers, as well as the overall economy, will benefit from these programs.”

“Some entities will need fiscal support, grants that US central bank cannot provide.”

“Fed will put emergency tools away when the economy is well on its way back to recovery.”

“There is every reason to believe that economic rebound, when it comes, can be robust.”

“Fed is using its tools to build a bridge from solid pre-crisis foundation to regained economic strength on the other side.”

Market reaction

Wall Street’s main indexes were up between 0.6% and 1.75% following these comments and the US Dollar Index was down 0.45% on the day at 99.70.