Fed prez Kashkari disputes Kudlow forecast

A key Federal Reserve official on Sunday threw cold water on the Trump administration’s optimism about the ability of the US economy to forge a snapback recovery from coronavirus-inflicted damage.

Asked on ABC’s “This Week” if such a recovery was a realistic forecast, Minneapolis Fed President Neel Kashkari said, “I wish it were.”

“What I’ve learned in the last few months unfortunately is that this is more likely to be a slow, more gradual, recovery,” he said.

“The virus continues to spread. And when we look around the world, there is evidence that when countries relax their economic controls, the virus tends to flare back up again.”

He said he expected the pandemic to go on in phases for the next year or two.

Just minutes prior to Kashkari’s interview, Larry Kudlow, who heads the White House’s National Economic Council, said signs pointed to a very strong second half of the year, “probably 20 percent economic growth” and a tremendous snapback in 2021.

White House officials also defended their decision to wait a few weeks before pushing ahead with another coronavirus relief package.

Kevin Hassett, a senior adviser to President Trump, said officials have a “luxury of a moment to learn about what’s going on” before taking the next relief steps.

“We’ve got a bunch of states starting to turn the lights back on. We’re watching both what happened both to economic activity and frankly the path of the disease as that happens,” he said.