FRB Chairman Jerome Powell Remarks on “Longer-Term” COVID-19 Impact on Economic crisis

(Photo by Federal Reserve via Getty Images)

Federal Reserve Chairman Jerome Powell states that the central bank would continue to use its policy tools to lessen the brunt of this economic crisis but that it could still turn to “long term concerns.”

“The recovery may take some time to gather momentum, and the passage of time can turn liquidity problems into solvency problems,” Powell said.

He states “We ought to do what we can avoid these outcomes, and that may require additional policy measures,” and “Additional fiscal support could be costly, but worth it if it helps avoid long-term economic damage and leaves us with a stronger recovery,” in virtual remarks at the Peterson Institute for International Economics.

Powell said the priority has been using Fed’s many tools aimed for avoiding a financial crisis and pledged to use those tools ”to their fullest” until the central bank is confident that the economic recovery is underway.

Powell’s remarks were not enough to save the Stock Market, however, as S&P 500, Dow 30, Nasdaq, and Russell 2000 all closed with negative outlook.

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