e-paper-stories Latest News USA

US Fed to focus on jobs, keep interest rates low, accepting inflation

Washington: The Federal Reserve on Thursday rolled out an aggressive new strategy to restore the United States to full employment and lift inflation back to healthier levels in a world where it now believes that “downward risks to employment and inflation have increased.”

Under the new approach, laid out in a fresh statement on the Fed’s longer-run goals and monetary policy strategy, the U.S. central bank will seek to achieve inflation averaging 2% over time, offsetting below-2% periods with higher inflation “for some time,” and to ensure employment doesn’t fall short of its maximum level, reports Reuters.

“Our revised statement reflects our appreciation for the benefits of a strong labor market, particularly for many in low- and moderate-income communities, and that a robust job market can be sustained without causing an unwelcome increase in inflation,” Fed Chair Jerome Powell said in prepared remarks for a speech explaining the changes.

With the U.S. economy in a deep economic crisis, the Fed’s new approach is both an acknowledgment of fundamental changes in the economy that began well before the coronavirus pandemic, and a map for how the Fed plans to conduct policy in a world where weak growth, low inflation and low interest rates are seen as here to stay.

With tens of millions of people out of work because of the fallout from the pandemic and the campaign for the Nov. 3 presidential election fast underway, the Fed’s transformation of the way it manages monetary policy could result in it keeping rates lower for longer than previously expected, although the Fed made no explicit promises on that front.

Read More
International USA

US is on way to roaring comeback: Trump

Washington: Now that people are getting their jobs back and the stock market is booming after the crisis triggered by coronavirus, the United States is on its way to a “very big comeback”, President Donald Trump has said.
“We are on our way to a very big comeback,” Trump told reporters at the White House on Wednesday.
The US, he said, is doing well in “so many ways”.
“You see what’s going on with NASDAQ. We just broke another record yesterday. Some good news came out of the Federal Reserve today,” the President said.
“We’re really doing a financial comeback. The jobs numbers were fantastic. Now we’ll have some other job numbers come up over the next few weeks, and we’ll see how that goes, but I think it’s really good,” Trump said.
Trump asserted the next year will be “maybe the best ever economy” that the US has seen.
“You can already see it with the stock market how it’s been going up because you have a lot of smart people that are betting on exactly what I’m saying because the stock market is almost as high as it was prior to the plague floating in from China,” he said.

Meanwhile, Treasury Secretary Steve Mnuchin has said the Trump administration is open to a second round of coronavirus Economic Impact Payments.

“I think we’re going to seriously look at whether we want to do more direct money to stimulate the economy,” Mnuchin told a hearing by the Senate Committee on Small Business and Entrepreneurship on Wednesday. “I definitely think we are going to need another bipartisan legislation to put more money into the economy.”

Read More