The u.s. economy bounces back sooner than expected

Photo: Jacquelyn Martin Associated Press
The president of the u.s. central Bank, Jerome Powell

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 so sooner 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 depend also on policy measures taken at all levels of government to bring relief [to households, businesses and communities in the most vulnerable local] and sustain the recovery for as long as necessary “, he also commented.

We have entered a new and important phase

— Jerome Powell

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 run dry and that new outbreaks of coronavirus reappear in the south 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 effect 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 dollars, but the republicans of the Senate to request amendments before the review.

The monetary Fund expects a recession of 8 percent this year in the United States. On Monday, Jerome Powell reiterated that the GDP contraction in the second quarter could be the worst in american history.

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