Powell and Yellen predict in Congress a vigorous economic recovery in the US

Jerome Powell, Chairman of the Federal Reserve, on Capitol Hill last December.Susan Walsh / AP

In appearances before both houses of Congress, the president of the US Federal Reserve (Fed), Jerome Powell, and the Secretary of the Treasury, Yanet Yellen, confirmed this Tuesday and Wednesday the good pace of the economic recovery, not without remembering that broad layers of the population still face the ravages of the pandemic.

"There are millions of Americans who suffer," stressed the head of the central bank.

Powell expressed his confidence that President Joe Biden's ambitious stimulus plan, valued at 1.9 trillion dollars and recently approved by Congress, will have a minimal effect, "neither particularly broad nor persistent", on inflation, the largest It threatens the economy when consumption has practically recovered the level prior to the health crisis, thanks to the good rate of vaccination and the decrease in the incidence of the virus.

On the eve of the White House finalizing a new $ 3 trillion economic plan to modernize infrastructure, Powell downplayed the risk of inflation, ensuring that if it spikes, "we have the tools to correct it."

"We expect inflation to rise this year, but part of the increase will be mechanical, and the rest due to higher demand."

Still, the recovery, Powell said, "is far from complete," so the central bank will continue "to offer the economy the support it needs for as long as it takes."

Among the data that tarnish the way out of the crisis is, for example, "a still high unemployment rate, 6.2%", very notable in sectors such as the hospitality industry, as well as the ten million jobs destroyed since March 2020 .

The head of Economy has emphasized, like Powell, the difficulties faced by the most vulnerable sectors of society, including a good part of the middle class, at risk of being thrown off the hook by the crisis.

"One owner in ten with a pending mortgage has fallen behind in the payment of the loan, and almost one in five tenants is delinquent," he stressed this Tuesday before the financial services committee of the House of Representatives.

"Twenty-two million Americans don't have access to enough food," Powell recalled.

Yellen pointed out that the US can return "to full employment in 2022", without specifying when, thanks to the addition of President Joe Biden's rescue plan and the projected infrastructure plan, "necessary to address the structural problems in the longer term that facing the economy and that have caused great income inequality ”.

The $ 3 trillion plan includes, in addition to the modernization of basic infrastructures and the creation of millions of jobs, specific items to improve and extend the public education network, benefits per child and the duration of medical leave, and to shore up

, some of whose provisions temporarily re-launch the recently approved bailout plan.

Last week, in its first prospective meeting of the year, the Fed raised its economic growth forecasts for the United States to 6.5% for 2021, compared to 4.2% at the end of 2020, after the approval of the ambitious package of fiscal stimulus by Congress.

At its meeting last week, the central bank also decided to keep benchmark interest rates at around 0%, after an abrupt cut in March 2020 following the declaration of the pandemic, as well as a program of multi-million dollar injections of liquidity through the purchase of debt, at a constant rate of 120,000 million per month.

The Fed's next monetary policy meeting is scheduled for April 27-28.

The state of affairs raised this Tuesday and Wednesday by those responsible for US economic policy confirms the decisive role of vaccination in the recovery.

At a rate of almost 2.5 million doses a day, immunization of the adult population is progressing faster than expected, with the record of 100 million vaccinated last week, which has eased restrictions in the service sector .

For example, leisure establishments, as well as large stadiums, will resume their activity in New York in April, with reduced capacity.