May 7, 2020 / 1:41 PM / 19 days ago

Fed's Bostic: Recovery hinges on permanence of unemployment

FILE PHOTO: President and Chief Executive Officer of the Federal Reserve Bank of Atlanta Raphael W. Bostic speaks at a European Financial Forum event in Dublin, Ireland February 13, 2019. REUTERS/Clodagh Kilcoyne

WASHINGTON (Reuters) - The strength of any coming U.S. economic recovery will depend on whether the emergency programs rolled out provide an effective “bridge” so companies rehire workers when the health crisis recedes, Atlanta Federal Reserve bank president Raphael Bostic said on Thursday.

With trillions of dollars in help still flowing through the economy but millions still filing initial unemployment claims last week, Bostic said the Fed was trying to understand the impact of emergency programs on joblessness.

“Does the relief provide a real bridge or is it partial and incomplete?” Bostic said in webcast remarks. If jobs losses are temporary “the recovery can be quite strong. If they are more permanent recovery is going to be harder and slower.”

Reporting by Howard Schneider; Editing by Chizu Nomiyama

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