A senior U.S. Federal Reserve official said on Sunday that another fiscal support package is "incredibly important" for the economy to recover from the pandemic as Congress failed to reach a deal on the new relief bill.
"I would say that fiscal policy has been unbelievably important in supporting the economy during the downturn that we've been experiencing," Charles Evans, president of the Federal Reserve Bank of Chicago, said in an interview with CBS's "Face the Nation."
"That continues to be important because we've not got control over the virus spread. I think that public confidence is really important and another support package is really incredibly important," he said.
Evans also said that there would be increases in job losses if Congress doesn't provide further fiscal support to state and local governments.
"States have to balance their budgets. They are experiencing reduced tax revenues. And so there will be employment reductions," he said, noting state and local governments account for about 10 percent of employment in the United States.
U.S. President Donald Trump on Saturday signed a series of executive orders to extend certain COVID-19 economic relief, but they're unlikely to provide meaningful boost to the overall economy.
"President Trump still does not comprehend the seriousness or the urgency of the health and economic crises facing working families," House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer said Saturday in a joint statement.
"The only solution to crush the virus and protect working families is to pass a comprehensive bill that is equal to the historic health and economic catastrophe facing our country," they said.
Mark Zandi, chief economist of Moody's Analytics, has recently warned that the U.S. economy is at serious risk of sliding back into recession unless Congress and the Trump administration come up with another fiscal rescue package before Congress goes on its August recess.
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