Powell Says More Fiscal Support Likely Needed

Q: Do you anticipate slowdown if no further fiscal stimulus?

A: SEP shows expectation that the recovery will continue at a reasonable pace through 2021, 2022, and 2023, and expect that pace will slow just because growth is fastest right at the beginning of the recovery because you had such a sharp decline.

In terms of fiscal policy. "I would start by saying that the initial response from fiscal authorities was rapid. It was forceful, and pretty effective. We seeing the results of that today in income and household spending data, labor market, construction data, ... so there's been a really positive effect...That said, my sense is that more fiscal support is likely to be needed.

Of course, the details for that are for Congress, not for the Fed...I would say the fiscal support has been essential in the good progress we see now. And finally, I'll note that just about all, the overwhelming majority of private forecasters who project an ongoing recovery are assuming there will be a substantial additional fiscal support."