The Fed is ready to do more to help US economy that has has come to a halt as businesses shutter and people stay home to slow the coronavirus pandemic, San Francisco Fed President Mary Daly said Tuesday.
“The Federal Reserve is prepared to do whatever it takes within our powers to ensure that we are part of the solution of shoring up people over the virus, shoring up the American economy and putting us in the best position to grow again once the virus recedes,” Ms. Daly said in an interview. “If we do the right thing and shelter in place and curb the spread of the virus, the economy will be in the best position to bounce back.”
With the COVID-19 coronavirus infecting tens of thousands of Americans and killing hundreds each day, 75% of the US population are under orders to stay home except for essential trips to slow the spread of the virus.
With businesses laying off millions of workers as demand dries up and states ordering non-essential businesses to close, the economy is likely already in recession, Ms. Daly said.
The Fed’s job, along with that of the US government that has finalized a $2.2-T aid/relief package, is to provide the support to financial markets, businesses and people who are doing their duty to boost the public health, she said.
Once the pandemic threat has passed, the Fed’s programs and low interest rates will help drive the economic recovery.
“The virus and its evolution will determine both the magnitude of the downturn and its duration,” she added that Fed staff are working to manage programs already underway and start up new ones, including the to-be-launched Main Street Lending Facility.
“The virus will also determine the amount of action we have to take. These are unprecedented times and they call for unprecedented action.”
Have a healthy day, stay home!