The U.S. economy could start to recover in the second half of the year after what is shaping up to be the worst recession in decades, but growth is likely to be slow and uneven, several top Fed policymakers indicated
FILE PHOTO: The Federal Reserve building is set against a blue sky, amid the coronavirus disease outbreak, in Washington, U.S., May 1, 2020. REUTERS/Kevin Lamarque
“We’re living through the most severe contraction in activity and surge in unemployment that we’ve seen in our lifetimes,” Federal Reserve Vice Chair Richard Clarida said in an interview with CNBC. “Unfortunately, the unemployment rate is going to surge to numbers that we’ve not seen probably since the 1940s.”
Stocks pulled back sharply after his comments, which were not the only dour ones from Fed policymakers on Tuesday. “Across the country there has been a fair amount of diversity of experiences, diversity of vulnerability and that will translate into diversity of recoveries,” Bostic said. Some businesses will be able to ramp up even with social distancing and other precautions in place, Evans said, while others, including travel and hospitality services, will not. A lot will depend on how safe consumers feel to be out spending.
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