The Strategist

Fed chief expects US economy to rise in second half of 2021

04/13/2021 - 03:38

Head of the US Federal Reserve (Fed) Jerome Powell believes that the US economy is at a tipping point. In his view, growth in the second half of the year will be "very strong".

Federalreserve via flickr
Federalreserve via flickr
"What we're seeing now in the economy looks like a tipping point... We feel we are in a place where the economy will start growing faster and jobs will be created faster... I would say that the growth we expect in the second half of this year will be very strong," Mr Powell told CBS. In his view, the main risk to the economy is the spread of the coronavirus. He believes people should continue to wear masks and keep a social distance.

The Fed and "private sector economic forecasters" expect growth to be around 6-7% in 2021. This will be the highest rate in 30 years, Mr. Powell said. Unemployment is forecast to fall from 6% to 4-5%.

Earlier, US President Joe Biden unveiled a $2 trillion bailout for the economy. The money from the new aid package the White House proposes to be used for a massive infrastructure upgrade. As part of the plan, it is proposed to change corporate taxation.