May 26, 2020
St. Louis Fed President James Bullard shared his views on reopening the U.S. economy following the partial shutdown in response to the pandemic. He also discussed his outlook for U.S. economic growth and unemployment during an interview on Fox Business.
Bullard said that there is a risk of keeping the shutdown in place for too long and that it can only go on for 90 to 120 days.
“I think we’re past the initial shock of the pandemic, and now we have to learn to adapt to the new risks that are out there,” he said. That is happening with businesses, as they are slowly reopening and experimenting with how they can provide their products and services in a safe way, he added.
Bullard noted that the main economic impact will be in the second quarter of 2020. While he expects the second quarter to be the worst in postwar U.S. macroeconomic history in terms of growth, he said the third quarter will likely be the best quarter of all time because businesses will open back up. However, he cautioned that the current shock is very different from others in the postwar era.
Regarding the unemployment rate, Bullard said that he expects it to decline starting in the second half of the year and to be under double digits by the end of the year.
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