(Reuters) – The Federal Reserve remains committed to using whatever tools it has to help the U.S. economy recover from the blow of the coronavirus pandemic, Chairman Jerome Powell said Monday.
“We continue to seek to use our tools to do what we can for as long as possible, to ensure the recovery is as strong as possible and to limit permanent damage to the economy.”
Powell said in remarks made prior to appearing Tuesday before the House Financial Services Committee, the first of three days on which Congress was witnessed this week.
Powell’s summary of the “significant improvement” in the economic landscape largely echoed what he said last week after the last Fed policy meeting, when policy makers promised to keep interest rates at zero until the economy hits full employment and inflation at one the most humble way is to exceed the central bank’s 2% target.
The housing sector has rebounded, consumer spending has recovered about 75% of its decline, and about half of the 22 million jobs lost in the crisis have returned, he said. “However, both employment and macroeconomic activity remain well below their pre-pandemic levels and the way forward remains very uncertain,” he said.
Powell’s speech included an update to the Fed’s Main Street Lending program, which now has 230 loans totaling approximately $ 2 billion in funding or in the pipeline. “The demand for Main Street credit may increase over time as the pandemic continues to affect the ability of businesses and nonprofits to access credit through normal channels and as other support programs expire,” he said.
Reporting by Dan Burns in New York and Ann Saphir in Berkeley, California; Adaptation by Leslie Adler and Matthew Lewis