INSUBCONTINENT EXCLUSIVE:
United States retail sales fell more than expected in NovemberThe Federal Reserve on Wednesday vowed to keep funneling cash into financial
markets until the United States economic recovery is secure, a promise of long-term help that fell short of hopes of an immediate move to
promise of a coronavirus vaccine, Fed Chair Jerome Powell acknowledged the United States central bank's suite of tools is not well-suited
to the most pressing needs faced by households and businesses today
"The parts of the economy that are weak are the service-sector businesses that involve close contact," such as restaurants and the travel
industry, Powell said in a news conference following the two-day meeting."Those are not being held back by financial conditions, but rather
by the spread of the virus" that is now intensifying across the country, he said
Unemployed households or struggling businesses are more in need of immediate cash, Powell added, something top lawmakers in Congress were
working to provide in talks towards a new $900 billion pandemic relief bill.For the Fed, the more relevant horizon is the middle of next
year, when Powell said the central bank is hopeful the country may approach widespread immunity from the coronavirus, and see economic
"The issue is the next four, five, six months," Powell told reporters
"You have to think some time in the middle of next year you will see people feeling comfortable going out engaging in a broader range of
activities."His comments seemed to diminish what some market analysts had taken as a given - that the Fed would at some point either
increase the pace or type of government bonds it is buying currently at a rate of $120 billion per month
But the rollout of a vaccine in the United States has added to hopes the economy may continue pulling steadily out of a recession that began
in March and which had elicited talk of a second Great Depression.In quarterly projections issued along with the policy statement, Fed
officials boosted their outlook for the economy's performance this year and in 2021
zero likely for years to come, the Fed added a more explicit promise to continue the current bond-buying program until there is "substantial
Between those two props for the economy, "our current policy stance is appropriate," Powell said, while adding that the Fed would consider
altering its bond purchases if economic conditions changed.The vote on the policy statement was unanimous, and for the first time links the
Fed's monthly purchases of United States Treasury bonds and government-backed securities to a set of economic conditions
It had previously pledged to make those purchases only "over coming months," with no firm guidance about when the recession-fighting program
might stop."We had expected perhaps an extension of the maturities of the asset purchases
They didn't do that," said Kathy Bostjancic, chief United States financial economist at Oxford Economics
"But this guidance, forward guidance on QE (quantitative easing) is pretty powerful ..
that gives some clarity, which is good." United States stocks traded largely higher on Wednesday, with the Nasdaq Composite closing at a
The Treasury yield curve steepened slightly while the dollar edged up against major trading partner currencies.Stimulus negotiationsThe
conclusion of the Fed's last policy meeting of 2020 capped a tumultuous year in which it slashed interest rates, ramped up bond purchases,
and took other extraordinary measures to stem the economic carnage of the coronavirus pandemic
Fed officials, however, have urged the federal government in recent months to step in with more pandemic-related relief to bolster the
economic recovery at a time when a surge in COVID-19 infections has led to more lockdowns and restrictions on businesses across the
country.United States retail sales fell more than expected in November, the Commerce Department reported on Wednesday, adding to growing
signs of a slowdown in the economic recovery
More than 304,000 people in the United States have died from COVID-19 since the start of the pandemic, according to a Reuters
tally.Lawmakers in Congress are "closing in on" a $900 billion COVID-19 aid bill that would include $600 to $700 stimulus checks and
extended unemployment benefits
Barring more aid from Washington, millions of unemployed Americans were slated to lose unemployment benefits the day after Christmas.Powell
told reporters that despite some progress in the economic recovery and unemployment rate, the pace of improvement is slowing and the share
market since the spring, we will not lose sight of the millions of Americans who remain out of work," he said.
