Tags: Coronavirus | Trump Administration | kudlow | fed | stock | markets | economy

Kudlow Praises Fed, Discusses Possible Stimulus as Stock Markets Sink

(AP)

Thursday, 11 June 2020 12:40 PM

White House economic adviser Larry Kudlow on Thursday sought to reassure stock markets sinking under concerns about a resurgence in the coronavirus pandemic.

The veteran financial guru and former Ronald Reagan adviser praised the Federal Reserve for planning to keep interest rates at zero for two years and said there are constant negotiations about more economic stimulus.

Kudlow spoke as U.S. stocks plunged, with the S&P 500 and the Dow set for their steepest percentage declines since April 1, as investors fretted over a new wave of coronavirus infections and a gloomy economic forecast from the Federal Reserve.

The three main U.S. stocks indexes were trading at a one-week low as new coronavirus cases rose in the United States after five weeks of declines, according to a Reuters analysis.

"I know today's a rough day but I don't think today is the last word," Kudlow said in an interview with Fox Business Network. "And by the way, we're still 40% above the March 23 low," said Kudlow, who worked as Reagan’s budget deputy between 1981 and 1985.

Kudlow also predicted economic growth will surge in the latter half of 2020 as states continue to reopen their economies from the coronavirus-induced lockdown.

"With the markets this morning, the trends are pointing upward," Kudlow said "And therefore I will defend the president's optimism. I think you've got 20 percent growth in the third and fourth quarters, and I think you'll get 4 percent or better in 2021," said Kudlow, who served as the Trump campaign's senior economic adviser.

Kudlow also praised the Federal Reserve, and its Chairman Jerome Powell, for planning to keep interest rates near-zero for the next two years.

"Chairman Powell is giving us zero interest rates for two years," Kudlow said. "That's really quite good. You can't probably get any more dovish than that. The balance sheet is going to rise by about $10 trillion by year-end."

© 2020 Thomson/Reuters. All rights reserved.


   
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White House economic adviser Larry Kudlow on Thursday sought to reassure stock markets sinking under concerns about a resurgence in the coronavirus pandemic.
kudlow, fed, stock, markets, economy, virus
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2020-40-11
Thursday, 11 June 2020 12:40 PM
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