Powell Answers Two Questions on Fiscal Policy

Q: How severe a threat to the economy if a stimulus package not passed by Congress before January?

- A: Up to Congress to decide...CARES Act essential in supporting the recovery, and likely that further support needed in both fiscal/monetary. Two risks that are well addressed by further fiscal policy: one is the spreads of the virus, the other is the lapsing of CARES act benefits and effect on personal balance sheets.

Q: Would the lack of fiscal support compel the Fed to provide additional accommodation, and are you more vocal on this topic because monpol is limited now at supporting growth?

- A: "we'll take into account all external factors and do what we think we need to do with the tools that we have to pursue our goals...that will go better and move more quickly if we have a broad set of policies from across the government." First and foremost it's healthcare policy (vaccine, etc).

Fiscal policy "can do what we can't", which is to replace lost incomes for people who are out of work. We can support financial stability through our lending programs, low rates etc. we're going to take the economy as it comes, including all external factors.

I think we'll have a stronger recovery if we can just get at least some more fiscal support, when it's appropriate.... I do think that will likely -- a lot of discussion on both sides of the aisle, on both sides of the hill that suggest generally that there will be something.