Atlanta Fed's Bostic Says Some Data Suggest Recovery Pace Leveling Off
By Michael S. Derby
Federal Reserve Bank of Atlanta President Raphael Bostic said
Wednesday there are signs that the U.S. economy's recovery from the
coronavirus pandemic-induced recession may be stalling as some
parts of the country appear to have not handled reopening efforts
as well as they could have.
Some real-time economic data suggest the "energy in terms of
reopening for businesses and for just general activity is starting
to level off," Mr. Bostic told reporters after a video
Mr. Bostic, who doesn't currently hold a voting role on the
rate-setting Federal Open Market Committee, said the outlook for
the economy remains uncertain. But he also said that some of the
more positive outcomes appear less likely than before as
coronavirus cases surge.
"I had in my head some more optimistic scenarios and some less
optimistic scenarios," Mr. Bostic said. "Some of the data might
have me leaning towards less optimistic scenarios in terms of how
much recovery there will be."
"We needed to reopen, but we need to do it cautiously and in a
judicious way," Mr. Bostic told reporters. "I think some of the
response to the ability to reopen has been done in a way that has
probably less caution than I would have liked, and is introducing
the possibility for higher infection rates."
Mr. Bostic's Federal Reserve district includes Florida, one of
the pandemic's biggest current hot spots.
During his video presentation, Mr. Bostic said he doesn't
believe a broad shutdown of the economy is likely again, adding
that he expects responses to the pandemic will be targeted: "I
don't think we'll see the same sort of blanket shutdown that we saw
before, at the very early stages of this."
Efforts to restrict economic activity as some states are doing
is coming at a cost that is concerning, Mr. Bostic added. "I do
worry significantly about what those things do to the collective
psyche of the consumer," because a recovery depends on consumers
feeling they can safely re-engage with the economy, he said.
Federal Reserve Bank of St. Louis President James Bullard has
warned a number of times that an extended closure of the economy
risks sending the U.S. into a full scale depression.
Mr. Bostic didn't point to any new actions on the part of the
Fed, but he said central bankers will continue looking for ways to
help the economy and are considering whether some other part of the
government might be better suited for action.
"The Fed definitely needs to think about whether more is
necessary," he told reporters.
Write to Michael S. Derby at email@example.com
(END) Dow Jones Newswires
July 08, 2020 16:46 ET (20:46 GMT)
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