Wednesday, April 29, 2020

Larry Kudlow predicts big "snapback"

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Treasury Secretary Steven Mnuchin on April 26 said that he expects the U.S. economy will “really bounce back” after the United States begins to reopen the economy in the coming months.⠀ ⠀ Mnuchin said he predicts that the trillions of dollars in federal rescue funds in response to the CCP virus pandemic will pay off as the economy comes roaring back in the summer months.⠀ ⠀ The latest #CCPvirus updates ➤ https://theepochtimes.com/ccp-virus⠀ ⠀ Get one month FREE FULL ACCESS to Epoch Digital.⠀ Sign up here: https://ept.ms/FreeMonth (no credit card needed)⠀ ⠀ Read this article: https://ept.ms/2VJ13sk⠀ ⠀ GET THE APP:⠀ iPhone - https://ept.ms/ETAppiPhone⠀ Android - https://ept.ms/ETAppAndroid

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President Trump's chief economic adviser Larry Kudlow on Wednesday predicted the U.S. economy will experience a big "snapback" from the coronavirus pandemic in the latter half of 2020. ⁣ ⁣"I think the second half of this year is going to grow, big snapback," Kudlow told Fox Business' Stuart Varney, suggesting growth could be as high as 20 percent. ⁣ ⁣The American economy shrank by 4.8 percent in the first three months of the year, the sharpest decline since the financial crisis more than a decade ago, the Commerce Department said Wednesday. It was the first drop recorded since the first three months of 2014, and the worst since the first quarter of 2009, when the economy contracted by 4.4 percent in the midst of the financial crisis. ⁣ ⁣Still, the severity of the coronavirus-induced downturn will be reflected more accurately in the second quarter, when the nation's economy came to a near standstill to mitigate the spread of the virus. Estimates vary widely — Goldman Sachs forecast a decline of 34 percent — but economists agree it'll be grim, possibly surpassing the worst of the Great Depression. (via @varneyco)

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The Federal Reserve on Wednesday pledged to continue taking aggressive action to support an economy devastated by the coronavirus pandemic, including holding interest rates near zero until policymakers are confident the U.S. has weathered the crisis and continuing to buy bonds. ⁣ ⁣In a unanimous statement, policymakers vowed to use its "tools and act as appropriate to support the economy.” They reiterated previous guidance that the benchmark federal fund rate will remain at the current range until Officials Wednesday left unchanged their vague guidance on the future path of rates. ⁣ ⁣The statement repeated language from March 15 saying the U.S. central bank would keep the benchmark target range near zero “until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals.” ⁣ ⁣The Fed, facing an economic threat that Chairman Jerome Powell previously characterized as "like no other," has already taken a range of extraordinary actions to support the economy, including slashing interest rates to near-zero, purchasing an unlimited amount of Treasurys (a practice known as quantitative easing) and launching crisis-era lending facilities to ensure that credit flows to households and businesses. It has also said it will buy corporate bonds and lend to states and cities.

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