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Powell expects growth in second half of year to be 'very strong'

Powell expects growth in second half of year to be 'very strong'
© Greg Nash

Federal Reserve Chairman Jerome Powell says he expects economic growth in the second half of this year to be “very strong.”

In an interview with “60 Minutes” that aired on Sunday, CBS’s Scott Pelley told Powell his projections for growth and employment sounded more like a “boom” than a “recovery.”

“I would say that this growth that we're expecting in the second half of this year is going to be very strong,” Powell said.

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Powell said the economy “seems to be at an inflection point," pointing to the extensive vaccination efforts throughout the country, and strong fiscal and monetary policy support.

“We feel like we're at a place where the economy's about to start growing much more quickly and job creation coming in much more quickly,” Powell told Pelley.

Powell added that the “principal risk” to the economy now is the coronavirus spreading again, which led him to urge people to continue wearing masks and practicing social distancing.

When pressed by Pelley on if the economy is “out of the woods,” Powell was hesitant to agree with his interpretation, but did say the outlook has “brightened substantially.”

“Well, I'd say that we and a lot of private sector forecasters see strong growth and strong job creation starting right now. So really, the outlook has brightened substantially,” Powell said.

Powell said forecasters on the Federal Open Market Committee are predicting growth in the range of 6 percent and 7 percent this year.

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He also noted that the committee is forecasting unemployment to move down “substantially” from the current 6 percent level to “maybe” between 4 percent and 5 percent.

The economy has tracked a strong recovery since the height of the pandemic. The Labor Department reported earlier this month that the U.S. added 916,000 jobs in March, and that the unemployment rate fell to 6 percent.

The department’s report shattered economist projections, which predicted that the U.S. would gain 675,000 jobs in March.