WASHINGTON (Reuters) – White House advisers hope to come up with several options to present to President Donald Trump for “big thoughtful policies” to help rebuild confidence in an economy battered by the coronavirus pandemic, a Trump economic adviser said on Sunday.
A man stands in front of a Modell’s store that is closed, as retail sales suffer record drop during the outbreak of the coronavirus disease (COVID-19) in New York City, New York, U.S., April 15, 2020. REUTERS/Bryan R Smith
Nationwide lockdowns to curtail the spread of the novel coronavirus have battered the U.S. economy, shuttering businesses and causing rising unemployment.
“We’re going to need really big thoughtful policies to put together to make it so that people are optimistic again,” White House economic adviser Kevin Hassett told reporters, warning that the U.S. jobless rate would likely hit 16% or higher this month.
“We hope to be talking to the president about it … to start to come up with the top five, six ideas that we want to take up with Congress,” he added.
Hassett said it was possible the economy could quickly rebound as it begins to reopen, but warned that things will start to look worse before they begin to look better.
“I think the next couple of months are going to look terrible,” Hassett said. “You’re going to see numbers as bad as anything we’ve ever seen before.”
A record 26.5 million Americans have filed for unemployment benefits since mid-March, and retail sales, homebuilding and consumer confidence have all weakened sharply.
The nonpartisan Congressional Budget Office predicted on Friday that the economy would contract at nearly a 40% annual rate in the second quarter, with unemployment cresting at 16% in the third quarter. But even next year, the CBO forecast the unemployment rate averaging above 10 percent.
U.S. Treasury Secretary Steven Mnuchin said the economy should “really bounce back” in the third quarter after it begins to reopen in May and June.
“We’re putting in an unprecedented amount of fiscal relief into the economy,” Mnuchin said on the Fox News Sunday program. “I think this is going to have a significant impact.”
Reporting by Tim Ahmann; Editing by Daniel Wallis and Will Dunham