Federal Reserve Chair Jerome H. Powell gave a dire warning Wednesday that the U.S. economy could become stuck in a painful multiyear recession if Congress and the White House do not authorize more aid to address the coronavirus pandemic’s economic fallout.
“Additional fiscal support could be costly but worth it if it helps avoid long-term economic damage and leaves us with a stronger recovery,” Powell said in a videoconference with the Peterson Institute for International Economics.
Powell’s statement was a sharp departure from the economic optimism President Trump and some senior administration officials have touted in recent days, as they have suggested a dramatic economic rebound will occur later this year and pick up even more momentum in 2021. Powell’s outlook was far more grim, and it helped send the Dow Jones industrial average down 517 points, or 2.2 percent.
