Yesterday the Fed issued its latest Beige Book update, where it saw ‘little or no growth’ in 4 out of their 12 regional districts. The other 8 showed only modest growth as the ongoing pandemic continued to wreak havoc with both company and personal finances. The majority of districts reported that employment was growing slower and that the recovery ‘remained incomplete’. On top of this companies were finding it harder to retain key staff, especially women, due to the ongoing challenge finding childcare and dealing with school closures caused by the virus.
The release followed a plea to Congress from Fed Chair Jerome Powell to provide more aid to ‘get us through the winter’ as the ‘The risk of overdoing it is less than the risk of under doing it’. He called for support for businesses and households until a vaccine allows for a broader resumption of commerce.
In his hearing before the Senate Banking, Housing and Urban Affairs Committee, Powell believed that the ‘outlook for the economy is extraordinarily uncertain and will depend, in large part, on the success of efforts to keep the virus in check’. He added ‘The rise in new COVID-19 cases, both here and abroad, is concerning and could prove challenging for the next few months. A full economic recovery is unlikely until people are confident that it is safe to re engage in a broad range of activities.