Fed’s Kashkari says U.S. economic recovery could take longer than hoped By Reuters

Fed's Kashkari says U.S. economic recovery could take longer than

© Reuters. President of the Federal Reserve Bank on Minneapolis Neel Kashkari listens to a question during an interview in New York

By Jonnelle Marte

(Reuters) – The economic recovery from the crisis spurred by the novel coronavirus could proceed more slowly than policymakers initially anticipated, potentially including a second wave of infections in the fall and another increase in the unemployment rate, Minneapolis Federal Reserve Bank President Neel Kashkari said on Friday.

“The recovery will take longer than we had hoped only a few months ago,” Kashkari said during a Twitter chat moderated by CBS News. “Many jobs are going to take a long time to come back.”

The federal government needs to keep supporting Americans who lost their jobs because of the coronavirus crisis and may not get back to work for a while, he said.

Unemployment benefits can help get money to jobless people who need help paying their bills, and capping those benefits at workers’ previous pay could “eliminate the disincentive to return to work,” he said.

Kashkari also cautioned that banks could take a hit if the downturn is prolonged. “I am concerned the longer this goes on, the more losses banks will face,” he said.

Large banks have more capital than they did before the 2008 financial crisis, but it may not be enough, he said, calling on banks to stop paying dividends and raise capital.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Source link

Leave a Reply

Your email address will not be published. Required fields are marked *

About us

InvestLab is a financial services technology company focused on the global trading market. Founded in 2010 in Hong Kong, the company develops trading, market data, and social research products that enable individual investors and small to mid-size brokers to access global markets. We provide brokers and financial institutions cross border capabilities for retail investors into 43 markets globally.