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Fed keeps interest rates near zero, saying the recovery will depend on the pandemic

CNN's Don Lemon talks to American economist and author Paul Krugman about President Trump's remarks on the economy and the GOP's stimulus plan.

Posted: Jul 29, 2020 10:41 PM
Updated: Jul 29, 2020 10:41 PM

The Federal Reserve left interest rates unchanged near zero in its monetary policy update Wednesday, and it once again reiterated that the economic recovery will depend on the path of the virus.

"The ongoing public health crisis will weigh heavily on economic activity, employment, and inflation in the near term, and poses considerable risks to the economic outlook over the medium term," the central bank said in a statement.

Even though the economy was beginning to rebound after grinding to a halt during the pandemic lockdown in the spring, the level of economic activity was still well below the levels from the start of the year, the Fed said.

"What that data shows is that the pace of the recovery looks like it has slowed since the cases began that spike in June," Federal Reserve Chairman Jerome Powell said in Wednesday's news conference.

"On balance it looks like the data are pointing to the slowing in pace in the recovery."

Powell again stressed that much of the burden of the pandemic crisis was borne by minorities and women, as well as low-wage earners.

While Congress's stimulus package in the spring helped keep businesses open and people in their homes, America is still in midst of a joblessness crisis and not all positions lost are expected to return. That means that some people will need support even when the economy recovers, Powell said. All in all, more still needs to be done in terms of both fiscal and monetary stimulus, Powell said.

The central bank Tuesday announced an extension to various pandemic lending facilities, including the main street lending facility that lends to small and medium-sized businesses. The facilities will now run through the end of the year.

On Wednesday, the bank also announced an extension of its temporary US dollar liquidity swap lines and the repurchase agreement facility for foreign central banks and international monetary authorities until March next year. This extension will ensure liquidity in dollar-funding markets around the world. The US currency is used in contracts around the world.

US stocks bounced higher following Powell's remarks, and finished the day higher.

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Illinois Coronavirus Cases

(Widget updates once daily at 7 p.m. CT)

Cases: 1413490

Reported Deaths: 25847
CountyCasesDeaths
Cook56254010557
DuPage936411321
Will779841042
Lake691321026
Kane60062816
Winnebago34671524
Madison32372533
St. Clair29976526
McHenry29561299
Peoria23690346
Champaign21566158
Sangamon19585245
McLean18846194
Tazewell17470308
Rock Island15375329
Kankakee14741224
Kendall13481100
LaSalle12954254
Macon11177215
DeKalb10270122
Vermilion10224154
Adams9557128
Williamson8117138
Whiteside7244174
Boone693380
Ogle629184
Grundy605579
Clinton590693
Coles5868101
Knox5728157
Jackson543565
Henry515270
Macoupin497090
Livingston494193
Woodford491883
Stephenson488086
Franklin485878
Effingham482674
Marion4761118
Jefferson4662123
Monroe451494
Randolph430387
Lee423754
Morgan412592
Fulton410559
Logan407066
Christian394275
Bureau384987
Montgomery384274
Iroquois329468
Perry328262
Fayette326856
McDonough305851
Jersey278752
Saline270657
Douglas263536
Union249041
Lawrence244627
Shelby235938
Crawford218026
Bond213624
Cass210327
Carroll204837
Pike200353
Ford194050
Hancock193732
Clark190434
Wayne189653
Warren186450
Jo Daviess183524
Richland181440
White180226
Edgar179742
Washington169225
Moultrie167928
Mason163547
De Witt161129
Piatt155814
Johnson154516
Clay154043
Greene152834
Mercer151734
Wabash147612
Massac143240
Cumberland131019
Menard127912
Jasper116818
Marshall110319
Hamilton89516
Schuyler8127
Brown8086
Pulaski7407
Stark66425
Edwards63512
Calhoun5382
Henderson53414
Gallatin5044
Scott5031
Putnam4943
Alexander48911
Hardin39612
Pope3394
Unassigned632432
Out of IL120

Indiana Coronavirus Cases

(Widget updates once daily at 8 p.m. ET)

Cases: 767409

Reported Deaths: 13980
CountyCasesDeaths
Marion1054251805
Lake569191030
Allen42938698
St. Joseph37313568
Hamilton37298426
Elkhart29749470
Tippecanoe23479230
Vanderburgh23201405
Porter19573327
Johnson18822392
Hendricks18072321
Madison13548346
Clark13533198
Vigo12834256
LaPorte12566225
Monroe12546178
Delaware11143198
Howard10672237
Kosciusko9777124
Hancock8740150
Bartholomew8262157
Warrick8069157
Floyd8027182
Grant7366181
Wayne7233201
Boone7184105
Morgan6910143
Marshall6332116
Dubois6274118
Cass6090111
Dearborn601278
Noble599290
Henry5947111
Jackson516377
Shelby510898
Lawrence4922127
Gibson462696
Montgomery458192
Clinton455255
DeKalb455285
Harrison453577
Whitley415745
Huntington415582
Steuben410660
Miami405573
Jasper401155
Knox388391
Putnam385062
Wabash369083
Adams352956
Ripley351271
Jefferson341886
White339654
Daviess3090100
Wells303581
Greene293485
Decatur292593
Fayette286364
Posey281735
Scott280058
LaGrange277572
Clay273348
Washington254037
Randolph247783
Jennings239449
Spencer238731
Fountain235250
Starke229859
Owen222659
Sullivan221343
Fulton208345
Jay202932
Carroll197322
Orange191156
Perry189739
Vermillion180844
Rush177527
Tipton172747
Franklin171935
Parke155216
Pike141734
Blackford138032
Pulaski123648
Newton123036
Benton109715
Brown106043
Crawford105616
Martin92515
Warren87715
Switzerland8348
Union73610
Ohio58111
Unassigned0428