Still, with about half of the 22 million payroll jobs lost in March and April still off the books, Powell’s statement suggests the rise in joblessness has been especially severe for low-wage workers, women and people of color.
“A full recovery is likely to come only when people are confident that it is safe to reengage in a broad range of activities,” according to Powell’s written statement. “The path forward will depend on keeping the virus under control, and on policy actions taken at all levels of government.”
Powell is scheduled to testify at 10:30 a.m. Tuesday alongside Treasury Secretary Steven Mnuchin. Both will also appear on Thursday before the Senate Banking Committee to give updates on the Cares Act, the federal coronavirus aid bill passed in March.
Powell is likely to get questions from lawmakers on the Fed’s Main Street lending program, which has become the focus of an ongoing debate about the Fed’s ability to directly help the economy beyond setting interest rates, ramping up asset purchases or flooding the stock market. The $600 billion program has roughly $2 billion in loans that are either funded or in the pipeline.
For months, businesses, lenders and lawmakers have argued that the program’s onerous terms mean loans aren’t quickly getting to businesses that need them imminently.
“Many borrowers will benefit from these programs, as will the overall economy, but for others, a loan that could be difficult to repay might not be the answer,” according to Powell’s remarks. “In these cases, direct fiscal support may be needed.”