Fed's Evans says ball is in Congress' court on US economy

Mr Neel Kashkari said the nation's budget gap can be financed without relying on foreign borrowing

Mr Neel Kashkari said the nation's budget gap can be financed without relying on foreign borrowing

Chicago Federal Reserve Bank President Charles Evans on Monday called forcefully for more USA government spending to support the economy, saying it is up to lawmakers and the White House to put the job market back on track toward health.

In an interview with CBS '"Face the Nation," Neel Kashkari said the only way to have "a really robust economic recovery" is to quell the coronavirus outbreaks that continue to appear across the country.

A top US Federal Reserve official made the case at the weekend for a "really hard" four-to-six week lockdown to suppress the novel coronavirus pandemic, adding that Congress had more than enough wherewithal to finance relief efforts.

"If we go very long without somehow addressing the reduction and evaporation of that support, I think it's going to show up in lower aggregate demand, and that would be very costly for the economy, individuals, households, people", Evans said.

Neel Kashkari, president of the Minneapolis Federal Reserve Bank, said the nation needs to control the spread of the virus, which is increasing across much of the country, to get back on a path to economic health.

New cases of Covid-19 in Laois this Bank Holiday Monday
The U.S. has only about 4 percent of the world's population but more confirmed cases and deaths than any other country. The COVID-19 Dashboard provides up-to-date information on the key indicators of COVID-19 in the community.

"If we don't do that and we just have this raging virus spreading throughout the country with flare-ups and local lockdowns for the next year or two, which is entirely possible, we're going to see many, many more business bankruptcies", Kashkari stated.

Treasury Secretary Steven Mnuchin, in an interview with ABC's "This Week", said that President Trump would spend what was needed, but the deficit was a factor.

The Democratic-led U.S. House of Representatives approved a $3 trillion relief bill in May, while Senate Republicans, many of whom have expressed concerns about mounting debt, countered by proposing a $1 trillion aid package last week.

"So while historically we would worry about racking up too much debt, we're generating the savings ourselves. That means Congress has the resources to support those who are most hurting".

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