Treasury Secretary Janet Yellen and Federal Reserve Chairman Jerome Powell told Congress on Tuesday that more must be done to limit the economic damage from the coronavirus pandemic.
Powell also reiterated that he does not expect programs aimed at reviving the economy will trigger unwanted inflation.
Both officials struck upbeat notes about the U.S. economy’s outlook in their appearances Tuesday before the House Financial Services Committee. They said that, while there are encouraging signs of a rebound, it is important that government support continue in order to make sure the millions of people who have lost jobs can return to the labor market.
Several Republican lawmakers expressed worries that run-way inflation could be triggered by the more than $4 trillion in support provided by Congress last year, the Biden administration’s recently approved $1.9 trillion support package, coupled with the Fed’s ultra-low interest rates.
Addressing those concerns, Powell said that the Fed remains strongly committed to its two policies goals of achieving maximum employment and stable prices, which it interprets as price increases averaging 2% per year.