The continuing uncertainty brought on by the C-19 coronavirus chaos may hamper the US economic rebound from instant recession, and more fiscal and monetary support will likely be needed, Boston Federal Reserve President Eric Rosengren said Friday.
Mr. Rosengren repeated his view that the US unemployment rate will likely be “at double-digit levels” at the end of Y 2020 and cautioned against reopening the economy too quickly after the end of lockdowns aimed at containing The China Virus.
Sounds too pessimistic to me in light of all of the positives happening with the economy, read my article on understanding the Fed’s current position, click here.
President Trump, the Treasury, Congress and the Fed moved quickly to support the economy by cutting interest rates to near Zero and rolling out a number of emergency lending facilities meant to keep credit available for businesses and households. In his remarks Friday, Rosengren said those moves likely were not enough.
“Despite these important policy actions to date, I believe more support is likely to be needed from both monetary and fiscal policy,” he said.
The Fed’s Main Street Lending Program, which targets small and medium-sized businesses, was officially launched this week after nearly 3 months of planning.
Mr. Rosengren said that recent changes the Fed made to expand the program should make it attractive to more borrowers.
“These are still early days in the program, and we are seeing a steady stream of interest,” Mr. Rosengren said.
Friday, Quad Witching Day’s price action was volatile. The S&P 500 gained as much as 1.3% on the open but then faded as much as 1.0% into the Red by the afternoon, finishing flat on huge volume at: DJIA -208.64 to 25871.48, NAS Comp +3.07 at 9946.13, S&P 500 -17.60 to 3097.61
Volume: Trade on the NYSE came in at 3.5-B/shares exchanged
- NAS Comp +10.9% YTD
- S&P 500 -4.1% YTD
- DJIA -9.4% YTD
- Russell 2000 -15.0% YTD
HeffX-LTN’s overall technical outlook for the week ended 19 June 2020 is Neutral with a Very Bullish bias.
Looking Ahead: Investors will receive the Existing Home Sales report for May Monday.
Have a healthy weekend, Keep the Faith!
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