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    Fed Chair Powell Offered a Patient Message. Markets Quivered Anyway.

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    #masthead-section-label, #masthead-bar-one { display: none }Biden’s Stimulus PlanWhat’s NextReconciliation, ExplainedFact Check$15 Minimum WageWhere Trump Voters StandAdvertisementContinue reading the main storySupported byContinue reading the main storyFed Chair Powell Offered a Patient Message. Markets Quivered Anyway.Stocks fell and bond yields rose after the Fed leader reiterated that the central bank did not plan to pull back policy support soon.Federal Reserve Chair Jerome Powell in Washington in December.Credit…Al Drago for The New York TimesMarch 4, 2021Updated 5:41 p.m. ETJerome H. Powell, the chair of the Federal Reserve, said he and his colleagues have a “high standard” for what full employment means, underscoring that the central bank is likely to be patient in removing its support for the economy.Mr. Powell pointed out that the virus has pushed many people out of the job market and said that “4 percent would be a nice unemployment rate to get to, but it will take more than that to get to maximum employment.” It is unlikely the job market will return to full speed this year, he added, speaking in an online question-and-answer session hosted by The Wall Street Journal.In fact, Mr. Powell’s entire message on Thursday centered on how cautious the central bank plans to be in dialing back economic policies — low interest rates and large-scale bond buying — that are meant to help the economy recover from the painful coronavirus shock.But antsy markets appeared unconvinced: Rates jumped and stocks slumped as the Fed chair spoke. The S&P 500 index, which had been up more than half a percent earlier in the day, fell into negative territory — eventually closing with its third consecutive day of decline.Investors have begun to pencil in faster growth and higher inflation in recent weeks, betting that a cocktail of big government spending, widespread vaccinations and rock-bottom interest rates are setting the stage for rapid growth and faster price gains. Market players have begun to speculate that the Fed might lift interest rates earlier than expected, even as the central bank’s top officials pledge patience.“The message, which he sent very clearly, was lower for longer,” said Subadra Rajappa, head of rates strategy at Société Générale. “It was the market reaction I was quite surprised by.”Ms. Rajappa said investors might have expected Mr. Powell to signal that the Fed was prepared to counteract recent market moves — perhaps by shifting toward longer-term bond purchases, among other policy options. He may have disappointed them by declining to tee up such a change.The yield on the 10-year Treasury note, an important benchmark that influences the cost of borrowing for companies and households alike, crept higher as the Fed chair spoke. It ended the day at 1.55 percent.Stock indexes fell as that happened. Higher interest rates can weigh on stock prices by making bond investing more comparatively attractive — higher yields can mean higher investment returns for buyers — and by nibbling into corporate profits.The Fed chair did acknowledge on Thursday that the Fed was watching the market fluctuations, saying that sharp bond market moves last week were “notable” and caught his attention and that he “would be concerned” by disorderly conditions or a persistent change that makes credit expensive and threatens the Fed’s goals.He rejected the idea that the central bank was poised to remove its policy support soon, saying at one point that the Fed was committed to “staying on the playing field, with our tools, until the job is really done” and the economy is healed.“My best guess is that he was trying to push back against the expectations of early rate hikes that have dominated the markets this year,” Roberto Perli, a partner and economist at Cornerstone Macro, said in an email. “What he said was no different from what he said so far, and the market needs something more convincing.”The central bank is currently buying $120 billion in government debt and mortgage-backed securities each month, and officials have said that they need to see “substantial further progress” before slowing that pace.Love’s Furniture and Mattresses in Warren, Mich., advertised its closing on Monday.Credit…Elaine Cromie for The New York TimesMr. Powell reiterated on Thursday that the Fed would communicate “well in advance” when it thinks it is reaching that threshold, while declining to put a date on when that might happen.“There’s reason to think that we’ll begin to make more progress, soon,” Mr. Powell acknowledged. “But even if that happens, as now seems likely, it will take some time to achieve ‘substantial’ further progress.”When it comes to lifting shorter-term interest rates, their classic policy tool, officials have been clearer about precisely what they want to accomplish before adjusting their cheap-money stance.“That’s going to depend entirely upon the path of the economy,” Mr. Powell said of the plan for interest rates. He said the country had to get to maximum employment, inflation must sustainably reach 2 percent, and those price gains must be on track to exceed 2 percent for some time.“Those are the conditions,” he said. “When they arrive, we will consider raising interest rates. We’re not intending to raise interest rates until we see those conditions fulfilled.”Even as many analysts anticipate higher inflation this year after very weak price increases in 2020, Mr. Powell was careful to draw a distinction between a short-term pop and a sustained acceleration.“If we do see what we believe is likely a transitory increase in inflation” then “I expect that we will be patient,” Mr. Powell said. “There’s a difference between a one-time surge in prices and ongoing inflation.”And when it comes to the job market, he pointed out that American employers now report 10 million fewer jobs than before the pandemic, leaving a lot of room for a labor rebound. The unemployment rate, which will be updated Friday, stood at 6.3 percent in January — still well above its 3.5 percent rate last year. And that understates the pandemic’s labor market cost, since many people have stopped looking for work altogether and are not counted into the official jobless number.Initial jobless claims increased last week after a big drop the prior week, the latest report showed, showing that the labor market’s recovery remains rocky for now, though a better performance might lie ahead as vaccines allow the economy to reopen more fully.“There’s good reason to expect job creation to pick up in coming months,” Mr. Powell said. “We need that.”Mr. Powell, whose term as Fed chair ends early next year, declined to comment on whether he would like another term. He was originally appointed as a governor by President Barack Obama, then elevated to chair by President Donald J. Trump. He said he was focused on the job at hand.“There’s a lot left to, we have a lot of ground left to cover,” he said. But given the advent of widespread vaccinations, there’s “good reason for optimism.”Matt Phillips contributed reporting.AdvertisementContinue reading the main story More

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    Powell Says Better Child Care Policies Might Lift Women in Work Force

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    #masthead-section-label, #masthead-bar-one { display: none }The Jobs CrisisCurrent Unemployment RateWhen the Checks Run OutThe Economy in 9 ChartsThe First 6 MonthsAdvertisementContinue reading the main storySupported byContinue reading the main storyPowell Says Better Child Care Policies Might Lift Women in Work ForceThe Fed chair said better caregiving options was an “area worth looking at” for Congress, while reiterating the central bank’s full-employment pledge.Jerome H. Powell, the Federal Reserve chair. He said that affordable child care could help women regain a foothold in the labor market.Credit…Al Drago for The New York TimesFeb. 24, 2021, 5:48 p.m. ETJerome H. Powell, the Federal Reserve chair, suggested on Wednesday that improved child care support policies from the government might help pull more women into the labor market.The Fed chief studiously avoided commenting on specific government policy proposals during three hours of wide-ranging testimony before the House Financial Services Committee. But he did acknowledge, in response to a question, that enabling better options for affordable child-care is an “area worth looking at” for Congress.“Our peers, our competitors, advanced economy democracies, have a more built-up function for child care, and they wind up having substantially higher labor force participation for women,” Mr. Powell said, answering a question from Representative Cindy Axne, an Iowa Democrat. “We used to lead the world in female labor force participation, a quarter-century ago, and we no longer do. It may just be that those policies have put us behind.”The Fed chair, who had also testified before the Senate Banking Committee on Tuesday, repeatedly refused to weigh in on the $1.9 trillion spending package the Biden administration has proposed or any of its individual provisions. The central bank is independent of politics, and it tries to avoid getting involved in partisan debates.But Mr. Powell did voice qualified support for a few broader ideas — like exploring better child-care options — and he stressed that in the near-term, it is critical to help workers who have been displaced from their jobs during the pandemic. He made it clear that the labor market remained far from healed, that the pandemic’s economic fallout has disproportionately hurt women and minorities, and that both Congress and the central bank have a role to play in supporting vulnerable families until the economy has recovered more fully.“Some parts of the economy have a long way to go,” he said Wednesday.Women’s labor force participation had climbed for decades in the United States before stalling out — and then actually dropping slightly — starting in the 1990s. As Mr. Powell alluded to, adult women in the United States hold jobs or look for them at lower rates than women in some other major advanced economies, such as Canada or Germany.Research has suggested that the divergence may be linked to child care policies. In a 2018 paper that asked why the share of Canadians who work or look for jobs had climbed even as United States labor force attachment had fallen, researchers at the Federal Reserve Bank of San Francisco pointed out that most of the gap owed to different outcomes for women. And they pointed to caregiving policy differences as a likely culprit.“Parental leave policies in Canada provide strong incentives to remain attached to the labor force following the arrival of a new child,” the paper, written by the San Francisco Fed president, Mary C. Daly, and co-authors, pointed out. “The contrast between the incentives Canada and the United States offer prime-age workers to remain attached to the labor force is clear.”The fact that child care responsibilities fall heavily on women in the United States has come under a brighter spotlight during the pandemic, which has shuttered schools and disproportionately left women bearing added child care responsibilities during the traditional workday.While women lost jobs less dramatically than men during the 2009 recession, their employment rate is down by about as much as men’s during the pandemic crisis. And when it comes to labor force participation, which measures the share of people who are either working or looking, women have lost more ground.Female participation dropped 2.1 percentage points to 55.7 percent in January, compared with February 2020, whereas men’s participation has dropped 1.7 points to 67.5 percent.Mr. Powell noted the disproportionate impact on Wednesday, saying that “women have taken on more of the child-care duties than men have at a time when kids are going to be at home, they’re not going to be at school in many places.”Throughout his tenure as Fed chair, Mr. Powell has been keenly focused on the job market. During the pandemic downturn, he has repeatedly said that both monetary and fiscal policymakers should support displaced workers so that they can make their way back into jobs when the economy reopens.While the Fed can help the economy and the job market to improve broadly, helping individual groups in a targeted way is generally left to elected officials, who can create more precise programs. That includes paving a clearer path to the labor market for mothers, which would mainly fall to Congress and the White House.The pandemic has shuttered schools and disproportionately left women to bear the added responsibility for looking after children during the traditional workday.Credit…Bridget Bennett for The New York TimesStill, the Fed can help to foster conditions for strong economic growth overall, which pulls people in the labor market and helps to set the stage for higher wages.Officials are trying to do that by keeping interest rates low and buying large quantities of government-backed bonds in order to keep many types of credit cheap, policies that can fuel both lending and spending. The Fed’s explicit aim is to achieve both maximum employment and slow but steady inflation that averages 2 percent over time.Mr. Powell signaled on Wednesday that interest rates, which have been at rock-bottom since March 2020, are likely to remain there for years to come. He also suggested that the Fed would be patient in slowing down its bond buying, waiting to see “substantial” further progress before changing that policy.Mr. Powell has been pledging for the past 11 months that the Fed would use its policies to help the economy get through the pandemic, but his comments have become noteworthy at a time when some lawmakers — in particular Republicans — have become worried that big government spending could fuel economic overheating that leads to rapid inflation.The Fed is tasked with keeping price gains under control. But its officials have been clear that weak price gains, not runaway ones, are the problem of the modern era. Central bankers try to keep price gains from slipping ever lower, because disinflation can be economically damaging.Mr. Powell reiterated that message Wednesday.“We live in a time when there are significant disinflationary pressures around the world,” he said, and so officials are trying to bolster prices. “We believe we can do it, we believe we will do it. It may take more than three years.”The Fed tweaked its approach to monetary policy in 2020, saying that it would aim for periods of slightly higher inflation and that it would no longer seek to cool off the economy just because the unemployment rate was falling — an approach monetary policymakers had for decades embraced as prudent. Mr. Powell’s colleague, the Fed governor Lael Brainard, explained the thinking in remarks delivered to a Harvard economics course Wednesday morning.“Removing accommodation preemptively as headline unemployment reaches low levels in anticipation of inflationary pressures that may not materialize may result in an unwarranted loss of opportunity for many Americans,” Ms. Brainard said. “It may curtail progress for racial and ethnic groups that have faced systemic challenges in the labor force.”The Fed was relatively patient in lifting interest rates after the 2007 to 2009 recession — leaving them near zero until 2015 and then raising them slowly. As they proceeded cautiously and unemployment dropped to 50-year lows, workers who had been counted out began to re-enter the labor market and employers started to go to greater lengths to recruit and train talent.“At very low levels of unemployment” the United States “saw benefits going to those at the lower end of the spectrum — which means disproportionately African Americans, other minorities, and women,” Mr. Powell said. “With our tools, what we can do, is try to get us back to that place.”AdvertisementContinue reading the main story More

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    Powell Focuses on Economic Need at Key Moment in Markets and Politics

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    AdvertisementContinue reading the main storySupported byContinue reading the main storyPowell Focuses on Economic Need at Key Moment in Markets and PoliticsThe Federal Reserve will continue to support the economy, its chair, Jerome H. Powell, pledged, even as concerns about inflation rise.Jerome H. Powell, chair of the Federal Reserve, during a hearing on Capitol Hill in December. He told lawmakers on Tuesday that America’s economy is a long way from recovered.Credit…Al Drago for The New York TimesFeb. 23, 2021Updated 6:57 p.m. ETThe economy is down nearly 10 million jobs since last February, prospects for a rapid recovery — while brighter — remain far from assured, and as Democrats try to move a $1.9 trillion relief package through Congress, Republicans argue that it’s too big and could lead to inflation that would hurt consumers and businesses.Speaking against that tense backdrop on Tuesday, the chair of the Federal Reserve, Jerome H. Powell, delivered a blunt message to lawmakers that the economic outlook remains wildly uncertain and that the central bank must continue its extraordinary efforts to support the economy.It’s a pledge Mr. Powell has made many times in the last 11 months, but it also resonated through financial markets, which had begun to quiver as investors worried that a rapidly improving economy would prompt the Fed to pull back on its efforts to bolster growth.In testimony before the Senate Banking Committee, Mr. Powell declined to weigh in on the Biden administration’s spending plans but pushed back on the idea raised by multiple Republican senators that the economy is on the cusp of running too hot and sparking inflation.“The economic recovery remains uneven and far from complete, and the path ahead is highly uncertain,” Mr. Powell said. “There is a long way to go.”To bolster growth, the Fed plans to encourage lending and spending by holding interest rates near zero, where they have been since March, and by continuing to buy large quantities of bonds to keep money pumping through the financial system. Investors have grown concerned that the Fed might slow those bond purchases sooner rather than later if inflation begins to rise.Those worried investors had driven down stocks for five consecutive days. On Tuesday, the S&P 500 fell nearly 2 percent before snapping back after Mr. Powell’s remarks.In the bond market, interest rates on longer-term government debt have been climbing, reaching their highest point in a year this week. Those rates are the basis for corporate borrowing and mortgages, and their rise contributed to the stock market’s jitters.“We’re in one of these market mania moments in which there’s an intense focus on inflation,” and “he was very sanguine, very calm,” said Julia Coronado, founder of MacroPolicy Perspectives and a former Fed economist. “He kept turning attention back to the labor market.”Mr. Powell reiterated that the Fed plans to keep buying bonds until it sees “substantial further progress” toward its twin goals of full employment and stable inflation. America can “expect us to move carefully, and patiently, and with a lot of advance warning” when it comes to slowing that support, Mr. Powell said.Joblessness has come down sharply after surging last year, but the official unemployment rate remains nearly double its February 2020 level. Job losses have been more acute for members of minority groups and those with less education. Though spending has bounced back, activity in the service industry is still subdued.Vaccines are feeding hopes for a stronger and more complete 2021 rebound. Prices are expected to rise temporarily in the coming months, both compared with the weak readings from last year and, potentially, as consumers spend down savings amassed during the lockdown on restaurant dinners and vacations.But Fed officials have been clear that they do not expect inflation to pick up in a lasting way and that they plan to look past temporary increases when thinking about their policies. Price pressures have been stubbornly tepid, rather than too high, for decades and across many advanced economies.Mr. Powell said that longer-running inflation trends do not “change on a dime” and that if prices start to rise in an alarming way, the Fed has the tools to fight that.“I really do not expect that we’ll be in a situation where inflation rises to troubling levels,” Mr. Powell said. “This is not a problem for this time, as near as I can figure.”He also pushed back on the idea that government spending is poised to send prices rocketing out of control.“There perhaps once was a strong connection between budget deficits and inflation — there really hasn’t been lately,” Mr. Powell said. He noted that while he does expect inflation to jump around in coming months, there is a distinction between a temporary pop in prices and a sustained increase.Still, he declined to weigh in on how much more government support is appropriate.“I, today, will really stay away from fiscal policy,” he said near the very start of the hearing. He went on to tiptoe around or simply decline to answer questions about the minimum wage and the size and various components of the White House’s spending proposal. At one point, he was asked whether he would be “cool” with passing the spending bill or not.“I think by being either cool or uncool, I would have to be expressing an opinion,” Mr. Powell said.The Fed is politically independent and steers away from partisan issues, but it has been providing advice to policymakers in Congress and weighing in on socioeconomic disparities and financial risks tied to climate change over the last year. Some of that outspokenness has drawn Republican attention.Senator Patrick J. Toomey, Republican of Pennsylvania, warned on Tuesday that the central bank should avoid moving beyond its core duties.“As noble as the goals might be, issues such as climate change and racial inequality are simply not the purview of our central bank,” Mr. Toomey said.Mr. Powell did talk about how strong labor markets help people on the margins — those who aren’t trained or those with criminal records — to succeed. He made it clear that the central bank is hoping to return to a strong labor market, like the one that preceded the pandemic.The Fed’s bond purchases can help to bolster the economy by lowering longer-term interest rates and by prodding investors out of safer assets, like government bonds, and into stocks and other more active uses of their cash.Mr. Powell said the economy over the last three months hasn’t “really been making” the substantial progress the Fed is looking for as a precondition for slowing its purchases, as job gains have slowed. But he said there’s an expectation that progress should “pick up as the pandemic subsides.”When it comes to the Fed’s main interest rate, the federal funds rate, which helps to guide borrowing costs across the economy, Mr. Powell also struck a cautious tone. The Fed wants to achieve full employment, hit 2 percent on inflation and believe that the economy is on track for even faster price gains before raising that rate.“Right now, our focus is on providing the economy the support it needs,” Mr. Powell said at one point, summing up his message.Matt Phillips More

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    Federal Reserve Officials Fretted Over Covid Surge at December Meeting

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    #masthead-section-label, #masthead-bar-one { display: none }Covid-19 VaccinesVaccine QuestionsDoses Per StateDistribution DelaysHow 8 Vaccines WorkAdvertisementContinue reading the main storySupported byContinue reading the main storyFed Officials Fretted Over Virus Surge at December MeetingMinutes from the central bank’s December gathering show that the chair, Jerome H. Powell, and his colleagues were hoping for a 2021 rebound.Federal Reserve officials were warily eyeing a coronavirus surge in December, but hoped that vaccine breakthroughs might set the stage for a strong economic rebound in 2021.Credit…Alex Welsh for The New York TimesJan. 6, 2021, 3:15 p.m. ETFederal Reserve officials were warily eyeing a surge in coronavirus cases at their Dec. 15-16 meeting, but they hoped that vaccine breakthroughs might set the stage for a strong economic rebound in 2021.“With the pandemic worsening across the country, the expansion was expected to slow even further in coming months,” according to minutes from the gathering of the Federal Open Market Committee, released Wednesday. “Nevertheless, the positive vaccine news” was “viewed as favorable for the medium-term economic outlook.”Central bank officials held interest rates steady at near zero at the meeting, and committed to buying up $120 billion in bonds each month “until substantial further progress has been made toward the committee’s maximum employment and price stability goals.” They have been rapidly expanding their holdings of government and mortgage-backed debt since March to keep markets calm and many types of credit cheap.The Fed essentially sets the price of borrowed money to help to guide demand in the economy, goosing conditions when times are tough to help bolster growth and hiring. The central bank also tries to keep price increases stable at around 2 percent, though officials formally updated their policy-setting approach last year to emphasize that they would welcome slightly faster increases after years and years of weaker ones.Minutes showed that the Fed discussed the balance sheet guidance in depth at the meeting, with “a few” remarking that the new wording signaled that the Fed could ramp up bond buying “if progress toward the committee’s goals proved slower than anticipated.”Many analysts had expected that the Fed would shift its bond purchases toward longer-dated debt to try to eke out a bigger bang per buck, given that short-term rates are already very low, but the minutes suggest that there was little appetite for such a change. Only “a couple of participants indicated that they were open to” shaking up the composition of purchases.The Fed’s December meeting took place as virus cases surged after Thanksgiving. Since then, the number of new cases moderated at first but then resumed their increase..css-fk3g7a{font-family:nyt-franklin,helvetica,arial,sans-serif;font-weight:700;font-size:0.875rem;line-height:1.125rem;color:#121212 !important;}@media (min-width:740px){.css-fk3g7a{font-size:0.9375rem;line-height:1.25rem;}}.css-1sjr751{-webkit-text-decoration:none;text-decoration:none;}.css-1sjr751 a:hover{border-bottom:1px solid #dcdcdc;}.css-rqynmc{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:0.9375rem;line-height:1.25rem;color:#333;margin-bottom:0.78125rem;}@media (min-width:740px){.css-rqynmc{font-size:1.0625rem;line-height:1.5rem;margin-bottom:0.9375rem;}}.css-rqynmc strong{font-weight:600;}.css-rqynmc em{font-style:italic;}.css-zs9392{margin:10px auto 5px;font-family:nyt-franklin,helvetica,arial,sans-serif;font-weight:700;font-size:1.125rem;line-height:1.3125rem;color:#121212;}@media (min-width:740px){.css-zs9392{font-size:1.25rem;line-height:1.4375rem;}}#NYT_BELOW_MAIN_CONTENT_REGION .css-zs9392{font-family:nyt-cheltenham,georgia,’times new roman’,times,serif;font-weight:700;font-size:1.375rem;line-height:1.75rem;margin-bottom:20px;}@media (min-width:740px){#NYT_BELOW_MAIN_CONTENT_REGION .css-zs9392{font-size:1.5rem;line-height:1.875rem;}}.css-121grtr{margin:0 auto 10px;}.css-16ed7iq{width:100%;display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-align-items:center;-webkit-box-align:center;-ms-flex-align:center;align-items:center;-webkit-box-pack:center;-webkit-justify-content:center;-ms-flex-pack:center;justify-content:center;padding:10px 0;background-color:white;}.css-pmm6ed{display:-webkit-box;display:-webkit-flex;display:-ms-flexbox;display:flex;-webkit-align-items:center;-webkit-box-align:center;-ms-flex-align:center;align-items:center;}.css-pmm6ed > :not(:first-child){margin-left:5px;}.css-5gimkt{font-family:nyt-franklin,helvetica,arial,sans-serif;font-size:0.8125rem;font-weight:700;-webkit-letter-spacing:0.03em;-moz-letter-spacing:0.03em;-ms-letter-spacing:0.03em;letter-spacing:0.03em;text-transform:uppercase;color:#333;}.css-5gimkt:after{content:’Collapse’;}.css-rdoyk0{-webkit-transition:all 0.5s ease;transition:all 0.5s ease;-webkit-transform:rotate(180deg);-ms-transform:rotate(180deg);transform:rotate(180deg);}.css-eb027h{max-height:5000px;-webkit-transition:max-height 0.5s ease;transition:max-height 0.5s ease;}.css-6mllg9{-webkit-transition:all 0.5s ease;transition:all 0.5s ease;position:relative;opacity:0;}.css-6mllg9:before{content:”;background-image:linear-gradient(180deg,transparent,#ffffff);background-image:-webkit-linear-gradient(270deg,rgba(255,255,255,0),#ffffff);height:80px;width:100%;position:absolute;bottom:0px;pointer-events:none;}#masthead-bar-one{display:none;}#masthead-bar-one{display:none;}.css-qmg6q8{background-color:white;margin:1.5rem auto 1.9rem;max-width:600px;}#NYT_BELOW_MAIN_CONTENT_REGION .css-qmg6q8{padding:0;width:calc(100% – 40px);max-width:600px;margin-right:auto;margin-left:auto;}.css-qmg6q8 strong{font-weight:700;}.css-qmg6q8 em{font-style:italic;}@media (min-width:740px){.css-qmg6q8{margin:40px auto;}}.css-qmg6q8:focus{outline:1px solid #e2e2e2;}.css-qmg6q8 a{color:#326891;-webkit-text-decoration:none;text-decoration:none;border-bottom:1px solid #ccd9e3;}.css-qmg6q8 a:visited{color:#333;-webkit-text-decoration:none;text-decoration:none;border-bottom:1px solid #ddd;}.css-qmg6q8 a:hover{border-bottom:none;}.css-qmg6q8[data-truncated] .css-rdoyk0{-webkit-transform:rotate(0deg);-ms-transform:rotate(0deg);transform:rotate(0deg);}.css-qmg6q8[data-truncated] .css-eb027h{max-height:300px;overflow:hidden;-webkit-transition:none;transition:none;}.css-qmg6q8[data-truncated] .css-5gimkt:after{content:’See more’;}.css-qmg6q8[data-truncated] .css-6mllg9{opacity:1;}.css-11uwurf{border:1px solid #e2e2e2;padding:15px;border-radius:0;margin:0 auto;overflow:hidden;}@media (min-width:600px){.css-11uwurf{padding:20px;}}#NYT_BELOW_MAIN_CONTENT_REGION .css-11uwurf{border-top:1px solid #121212;border-bottom:none;}Covid-19 Vaccines ›Answers to Your Vaccine QuestionsWith distribution of a coronavirus vaccine beginning in the U.S., here are answers to some questions you may be wondering about:If I live in the U.S., when can I get the vaccine? While the exact order of vaccine recipients may vary by state, most will likely put medical workers and residents of long-term care facilities first. If you want to understand how this decision is getting made, this article will help.When can I return to normal life after being vaccinated? Life will return to normal only when society as a whole gains enough protection against the coronavirus. Once countries authorize a vaccine, they’ll only be able to vaccinate a few percent of their citizens at most in the first couple months. The unvaccinated majority will still remain vulnerable to getting infected. A growing number of coronavirus vaccines are showing robust protection against becoming sick. But it’s also possible for people to spread the virus without even knowing they’re infected because they experience only mild symptoms or none at all. Scientists don’t yet know if the vaccines also block the transmission of the coronavirus. So for the time being, even vaccinated people will need to wear masks, avoid indoor crowds, and so on. Once enough people get vaccinated, it will become very difficult for the coronavirus to find vulnerable people to infect. Depending on how quickly we as a society achieve that goal, life might start approaching something like normal by the fall 2021.If I’ve been vaccinated, do I still need to wear a mask? Yes, but not forever. Here’s why. The coronavirus vaccines are injected deep into the muscles and stimulate the immune system to produce antibodies. This appears to be enough protection to keep the vaccinated person from getting ill. But what’s not clear is whether it’s possible for the virus to bloom in the nose — and be sneezed or breathed out to infect others — even as antibodies elsewhere in the body have mobilized to prevent the vaccinated person from getting sick. The vaccine clinical trials were designed to determine whether vaccinated people are protected from illness — not to find out whether they could still spread the coronavirus. Based on studies of flu vaccine and even patients infected with Covid-19, researchers have reason to be hopeful that vaccinated people won’t spread the virus, but more research is needed. In the meantime, everyone — even vaccinated people — will need to think of themselves as possible silent spreaders and keep wearing a mask. Read more here.Will it hurt? What are the side effects? The Pfizer and BioNTech vaccine is delivered as a shot in the arm, like other typical vaccines. The injection into your arm won’t feel different than any other vaccine, but the rate of short-lived side effects does appear higher than a flu shot. Tens of thousands of people have already received the vaccines, and none of them have reported any serious health problems. The side effects, which can resemble the symptoms of Covid-19, last about a day and appear more likely after the second dose. Early reports from vaccine trials suggest some people might need to take a day off from work because they feel lousy after receiving the second dose. In the Pfizer study, about half developed fatigue. Other side effects occurred in at least 25 to 33 percent of patients, sometimes more, including headaches, chills and muscle pain. While these experiences aren’t pleasant, they are a good sign that your own immune system is mounting a potent response to the vaccine that will provide long-lasting immunity.Will mRNA vaccines change my genes? No. The vaccines from Moderna and Pfizer use a genetic molecule to prime the immune system. That molecule, known as mRNA, is eventually destroyed by the body. The mRNA is packaged in an oily bubble that can fuse to a cell, allowing the molecule to slip in. The cell uses the mRNA to make proteins from the coronavirus, which can stimulate the immune system. At any moment, each of our cells may contain hundreds of thousands of mRNA molecules, which they produce in order to make proteins of their own. Once those proteins are made, our cells then shred the mRNA with special enzymes. The mRNA molecules our cells make can only survive a matter of minutes. The mRNA in vaccines is engineered to withstand the cell’s enzymes a bit longer, so that the cells can make extra virus proteins and prompt a stronger immune response. But the mRNA can only last for a few days at most before they are destroyed.Officials have been voicing hope that vaccine distribution, which has gotten off to a slow start in much of the United States, will pave the way for an economic rebound in the latter half of 2021. They have been clear that their outlook hinges on the success of that process and the path of the pandemic.“The second half of the year looks much more promising because of vaccinations,” Loretta Mester, president of the Federal Reserve Bank of Cleveland, said on a call with reporters this week.But even if the rebound is remarkable, officials have been clear that they are likely to remain patient in taking support away from the economy.Ms. Mester, who has a history of favoring higher rates than many of her colleagues, has said she probably would not be worried about 2.5 percent inflation. Her colleague Charles Evans, who is president of the Federal Reserve Bank of Chicago and a monetary policy voter this year, said during an event on Tuesday that a 3 percent price gain pace “would not be so bad.”Presidents at 11 of the Fed’s 12 regional banks share rotating votes on monetary policy. The Federal Reserve Bank of New York president and members of the Board of Governors in Washington hold a constant vote on interest rates.In the near term, economic weakening — rather than navigating a rapid rebound — is likely to be the main challenge confronting the Fed. Private payrolls contracted by 123,000 jobs between November and December, data from ADP showed on Wednesday. The government’s official employment report on Friday is expected to show either a marked slowing in job gains or a return to outright losses.According to the December minutes, “Participants saw increased challenges for the economy in the coming months, as the ongoing surge of Covid-19 cases and the related mandatory and voluntary measures prompted greater social distancing and damped spending, especially on services requiring in-person contact.”The Fed’s December meeting took place before two significant developments that could affect the economy in the short term. Late last month, Congress agreed to provide additional support to the American economy in the form of a $900 billion relief bill.And Democrats appeared on the cusp of retaking the Senate, which could pave the way for easier passage of the priorities of President-elect Joseph R. Biden Jr., which could include additional fiscal help for firms and families.“The Fed will welcome greater prospects of fiscal support, which most officials believe is better targeted to address challenges unique to the Covid cycle than monetary policy,” economists at Evercore ISI wrote in a research note on Wednesday.AdvertisementContinue reading the main story More

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    Fed Leaves Rates Unchanged and Commits to Ongoing Bond Purchases

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    #masthead-section-label, #masthead-bar-one { display: none }The Coronavirus OutbreakliveLatest UpdatesMaps and CasesThe Latest Vaccine InformationU.S. Deaths Surpass 300,000F.A.Q.AdvertisementContinue reading the main storySupported byContinue reading the main storyFed Leaves Rates Unchanged and Commits to Ongoing Bond PurchasesCentral bank officials left rates near-zero at their December meeting and tied bond buying to their employment and price goals.Jerome H. Powell, the Federal Reserve Chair, said Wednesday that the central bank will keep interest rates near zero to support the economy as coronavirus cases surge nationwide, adding that “a full economic recovery is unlikely until people are confident that it is safe to re-engage in a broad range of activities.”CreditCredit…Al Drago for The New York TimesDec. 16, 2020Updated 5:26 p.m. ETWASHINGTON — Federal Reserve officials pledged to help the economy through the painful pandemic era, making clear at their final meeting of the year that the central bank would continue cushioning businesses and households by keeping interest rates at rock bottom and buying government-backed debt for the foreseeable future.The Fed’s chair, Jerome H. Powell, said at a news conference after the meeting that the central bank would keep its effort to bolster demand going “for some time,” adding that the “the next few months are likely to be very challenging.”The Fed cut interest rates to near-zero in March and has been buying about $120 billion in government-backed debt each month to soothe markets and help shore up growth. The central bank explicitly tied its bond-buying program to its goals of full employment and stable inflation in its December policy statement. The move suggested that the Fed expected to continue its purchases for some time, given how far the economy is from meeting those goals.The committee said the Fed would continue to increase its holdings of Treasury securities at the current pace “until substantial further progress has been made toward the committee’s maximum employment and price stability goals.”Mr. Powell said the policy decisions were intended to show that the Fed would “deliver powerful support to the economy until the recovery is complete.”He used his post-meeting remarks to paint a picture of a bifurcated economy, one in which many businesses and households face acute economic pain in the near-term, coupled with the expectation that the economy would snap back once vaccines were widely available — a development that he guessed could come about as soon as midyear.The United States could then see a long period of unbroken growth, Mr. Powell predicted, signaling that he and his colleagues were prepared to leave rates low for years on end as they try to return the labor market and broader economy to full strength.Government policies are “trying to work together to try to create a bridge across this economic chasm that was created by the pandemic, and for many Americans, that bridge is there, and they’re across it,” he said.“But there’s a group for which they don’t have a bridge yet,” Mr. Powell added, suggesting later that more help from Congress is needed to help fill the gap. “It’s the 10 million people who lost their jobs, it’s the people who may lose their homes. You see the many, many millions of Americans who are waiting in food lines in their cars these days.”He said the economy would need the Fed’s support for some time because while officials expect it to grow at a healthy clip starting in the middle of next year, “it is going to be a while before we really are back to the levels of labor market conditions that we had early this year.”The central bank’s summary of economic projections, released Wednesday, underlined Mr. Powell’s patient point. They showed that Fed officials had a slightly more optimistic outlook for growth and unemployment at the end of 2020 and in coming years than they had been in September. The central official now sees unemployment declining to 5 percent in 2021, versus a previous prediction of 5.5 percent, and sees gross domestic product coming in at 4.2 percent versus 4 percent.Despite that upgrade, the median Fed official continued to project interest rates near-zero through the end of 2023, demonstrating the central bank’s plan to move glacially coming out of the crisis.While the Fed promised to do what it could to help the economy, Mr. Powell also stressed its limitations. He repeated his call for more fiscal stimulus, saying that the continuing rise in virus cases and the lapse in funding for several programs that were helping households and businesses stay afloat posed challenges.The Coronavirus Outbreak More