Dallas Fed President Robert Kaplan said when US get to a “normalized economy” would depend on “the path of the virus” and “how well we manage it, and the timing of the vaccine”. Fed would not need to do as much “if we do an outstanding job and a better job managing the virus”.
He’s optimistic that in 2021, “we will see an above-trend growth and we will continue to grind down the unemployment rate”. And if Americans follow the protocols of handling the coronavirus, “we would see a rebound from the deep hole we dug in the second quarter”.
Separately, Philadephia Fed President Patrick Harker said the effects of the coronavirus pandemic are “proving not to be just a brief setback”. The US economy is in a “downturn that is both exceptionally painful and stubbornly long-lasting.” “There’s both the direct economic impact of businesses having to close down,” he added. “But I also worry about the psychological impact on consumer confidence.”
