Fed Calls for Fiscal Stimulus

    U.S. stocks have been down with concerning about the economic recovery and the need for more stimulus. The S&P 500 was down 2.3% as of 3:05 p.m. Est, its fifth decline in six days. The Nasdaq 100 fell 3.2%.

 

    Federal Reserve officials released new economic forecasts on Sept 16, with the median forecast for the unemployment rate of the fourth quarter 2020 falling to 7.6% from the 8.4% expectation in August, with the unemployment rate expected to be 5.5% by the end of 2021. Despite a better-than-expected rebound in the U.S. economy, several Fed officials on Wednesday emphasized the importance of fiscal stimulus to the recovery. Fed Chairman Jerome Powell continued to call for financial support in congress hearings, saying more stimulus may be necessary for the economy to recover.

Fed Vice Chairman Richard Clarida also stressed in an interview with Bloomberg Television that the recovery has so far been stronger than officials expected a few months ago, but the road will be difficult. He reiterats that financial support would help the economy. His forecast is based on the government's new one trillion dollar stimulus.