Daily Management Review

US Fed expects solid GDP growth in the second half of 2021


The US Federal Reserve expects solid GDP growth in the second half of 2021, US central bank governor Jerome Powell said.

"My expectation - and I think many people have that expectation - is that the economy will perform well in the second half of 2021, people will go back to work, businesses will open up," Powell said at a press conference.

"The question is in the next four to five months," he added.

"We can already see the light at the end of the tunnel... We have to continue to support the economy for some time, because we expect the economy to grow at a fairly healthy pace by the second half of next year, but it will take considerable time before we get back to the labour market conditions that we had earlier this year," Powell said.

The US Federal Reserve maintained the benchmark interest rate at 0-0.25% per annum at the end of its December meeting, while forecasting the rate to remain at that level until and including 2023. The Fed also lowered the US unemployment forecast for 2020 from 7.6% to 6.7%. The unemployment forecast for 2021 was also improved from 5.5% to 5.0%.

source: cnn.com