Highlights of Philly Fed's Harker (voter).......>

FED: Highlights of Philly Fed's Harker (voter) speech before Chicago Council on

Global Affairs:

- Notes two possible paths for US economy: 1) If economy reopens in June, sees

robust growth in H2, but 'not enough to full offset the contraction in Q1 and

Q2.' Growth in 2021 above trend. 

- Alternatively, if economy reopens without effective mitigation measures, U.S.

could experience 'significant second wave of the virus,' the economy could

'severely contract again in 2021.'

- Unprecedented 7.5% March fall in consumer spending, even before states took

serious action, strongly suggests virus itself, and not just government policies

designed to mitigate it, are harming the economy

- Recovery may be uneven. Manufacturing of durables 'should come back quickly.'

Trade and hospitality may be in for a longer and more painful contraction.

Commercial real estate could suffer.

- Urges banks to retain capital as economy enters 'a tough period. Banks

'probably shouldn't be issuing large dividends at the moment.'