(Reuters) – The Federal Reserve remains committed to using all the tools at its disposal to help the U.S. economy recover from the blow delivered by the coronavirus pandemic, Chair Jerome Powell said on Monday.
“We remain committed to using our tools to do what we can, for as long as it takes, to ensure that the recovery will be as strong as possible, and to limit lasting damage to the economy,”
Powell said in remarks released ahead of Tuesday’s appearance before the House of Representatives Financial Services Committee, the first of three days of testimony to Congress this week.
Powell’s summation of the “marked improvement” in the economic landscape largely repeated what he said last week after the Fed’s latest policy meeting, at which policymakers promised to keep interest rates pinned at zero until the economy reaches full employment and inflation is on track to modestly overshoot 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. “Both employment and overall economic activity, however, remain well below their pre-pandemic levels, and the path ahead continues to be highly uncertain,” he said.
Powell’s speech included an update on the Fed’s Main Street Lending program, which now has funded or has in the pipeline 230 loans totaling roughly $2 billion. “Demand for Main Street loans may increase over time if 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, Calif.; Editing by Leslie Adler and Matthew Lewis