Federal Reserve Chairman Jerome Powell said Tuesday that the worst of the economic crisis caused by the coronavirus could nearly be over as businesses start to reopen across the country.
“We may be reaching a bottom on that now,” he told the Senate Banking Committee, but he cautioned that his projection is based on a second coronavirus wave not affecting the country.
“Let’s just assume that that doesn’t happen,” he said.
Powell referenced the latest increase in retail sales as evidence that the economy is coming back. The U.S. Census Bureau announced on Tuesday that retail sales increased 18% in May. That figure is up from contractions of 14.7% in April and 8.3% in March.
As businesses reopen, Powell expects a large number of jobless workers will return to employment.
“That should result in a significant amount of jobs gains,” he said, adding that “our expectation, generally, and the expectation of other forecasters is that we will see unemployment decline and employment increase.”
Still, the chairman does not foresee a return to the low unemployment rates that the country has experienced over the past few years.
