The economic growth projections Federal Reserve officials offered last week by and large do not factor in a potential second wave of coronavirus infections later this year, Fed Chair Jerome Powell said on Tuesday.

Powell's remark came in the first of two days of testimony to Congress, during which he repeated a now-standard mantra that the disease will determine the strength and persistence of any recovery from the recession that began in February.

That said, it appears a second wave is not his or his colleagues' base case.

At their meeting last week, 17 Fed policymakers provided their first take on where the economy goes next in the wake of the pandemic. The median view called for a full-year contraction in gross domestic product of 6.5% from 2019.

"Does this projection assume a potential second wave of coronavirus and the accompanying economic impacts?" Senator Krysten Sinema, an Arizona Democrat, asked Powell.

"That number is actually the median of the projections of the 17 participants of the FOMC (Federal Open Market Committee) so it isn't an official prediction of the Fed," Powell said in reply. "It will be based on different assumptions made by different people. Each of the 17 will have probably made a somewhat different assumption."

"I would think the answer to your question, though, largely will be that ... my colleagues will not principally have assumed that there will be a substantial second wave."

"Oh, that's concerning," Sinema retorted.

To be sure, the 17 projections cover a wide-range of potential outcomes, the worst of which arguably could take into account a resurgence of COVID-19 in the second half of the year. Policymakers' estimates for the 2020 change in GDP ranged from a low of negative 10% to a high of negative 4.2%.

Still, to Powell's point, the "central tendency," which reflects the weight of estimates, ranged from negative 7.6% to negative 5.5%, which would not appear to factor a substantial drag from any second wave. 

Meanwhile, Philadelphia Federal Reserve Bank President Patrick Harker said the U.S. economy could begin to recover from a sharp recession next year as the labor market recovers, but it may take time for the economy to return to the levels seen earlier this year.

Harker said he expects "2021 will be a growth year, with GDP and employment picking up," according to remarks prepared for a virtual event organized by the Chamber of Commerce for Greater Philadelphia.

But he cautioned that the economic pain could linger, adding that the growth seen next year may not be "enough to return the economy to where it was at the beginning of this year."

Even as the economy rebounds, some Americans could face long spells of unemployment, Harker said.

"Some of the jobs that have been lost because of the COVID-19 crisis may never return," he said. 

Elsewhere, the ongoing coronavirus crisis is dragging inflation down, Federal Reserve Vice Chair Richard Clarida warned, another sign that the U.S. economy may need more help from the central bank and Congress before it can return to health.

Inflation expectations, already low at the start of the recession that began in February, are "at risk of falling below" a range consistent with the Fed's 2% inflation goal, Clarida said in remarks prepared for delivery to the Foreign Policy Association in New York.

"I will place a high priority on advocating policies that will be directed at achieving not only maximum employment, but also well-anchored inflation expectations consistent with our 2 percent objective," he said. "Depending on the course of the virus and the course of the economy, more support from both fiscal and monetary policy may be called for."

Fed policymakers including Powell have focused most heavily on the need to bring back the millions of jobs lost in the recession. Clarida's remarks suggest that the drag that too-low inflation can exert on growth is equally a concern motivating the Fed's unprecedented support for the economy. That included last week's pledge to continue buying $120 billion of bonds monthly and a signal the Fed plans to keep interest rates near zero for years.

Recently eased financial conditions from the Fed's unprecedented credit and market backstops and willingness to lend freely to much of the economy if needed should help households and firms, he said.

Clarida echoed Powell's view earlier in the day in Congressional testimony that jobs growth in May was a "welcome" development. He also agreed with Powell that the economy will resume growth in the third quarter after an expected large decline in the current quarter.

The return to a healthy economy will take "some time," Clarida said.