Federal Reserve Chairman Jerome Powell began two days of congressional testimony Tuesday in an economic climate — not to mention political — that is very different from June, the last time the Fed chair gave his semiannual monetary policy report.
Powell presents the report to the Senate Banking Committee on Tuesday and the House Financial Services Committee on Wednesday. He’ll be facing tough questions, experts say: Republicans will want to know if a $1.9 trillion stimulus package risks sending inflation skyrocketing, while Democrats are likely to push the central bank head to articulate how the pandemic has exacerbated economic inequality among Americans.
“We’re not out of the woods yet when it comes to the virus, and the economy also remains quite far from a full recovery,” said Steve Friedman, senior macroeconomist at MacKay Shields. “Powell has been very focused on the fact that millions of workers and their families have faced significant hardship because of the pandemic.”
Powell has said top-line figures on job growth camouflage a falloff in labor force participation, estimating that the real unemployment rate is likely closer to 10 percent than the official 6.3 percent as calculated by the Bureau of Labor Statistics for January…