Fed’s Powell warns of ‘highly uncertain’ US outlook, Dow falls 2%

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by Daily Sabah with AFP

U.S. Federal Reserve Chairman Jerome Powell arrives to speak to reporters after the Federal Reserve cut interest rates in an emergency move designed to shield the world’s largest economy from the impact of the coronavirus, during a news conference in Washington, U.S., March 3, 2020. (Reuters Photo)

Wall Street stocks slid to session lows Wednesday as Federal Reserve Chair Jerome Powell cautioned that the U.S. economic outlook was “highly uncertain” in light of the surging COVID-19 outbreak.

The Dow Jones Industrial Average had been trending lower most of the day, and near 8 p.m. GMT, it was down 2.0% at 30,320.64.

The broad-based S&P 500 slumped 2.6% to 3,751.56, while the tech-rich Nasdaq Composite Index also shed 2.6% to 13,278.89.

The spike in COVID-19 cases in the United States is hampering the country’s economic recovery from the downturn caused by the pandemic, Powell said.

“A resurgence in recent months of COVID-19 cases, hospitalizations and deaths is causing great hardship for millions of Americans and weighing on economic activity and job creation,” the central bank chief added, calling the outlook “highly uncertain.”

Powell also said that “real unemployment” is around 10% in the United States.

In a statement later in the day, the Fed also said that it will keep interest rates low until employment has recovered.

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