Steven Mnuchin: Reopening needed to avert 'permanent economic damage' to the public

Steven Mnuchin: Reopening needed to avert 'permanent economic damage' to the public

Trump administration officials sought Sunday to lower short-term expectations on the cratering economy, predicting that unemployment will spike in the second quarter while promising a historic rebound in the latter half of 2020 — right before the presidential election.

“The reported numbers are probably going to get worse before they get better, but that is why we are focused on rebuilding this economy,” said Treasury Secretary Steven T. Mnuchin on “Fox News Sunday.” “We’ll have a better third quarter. We’ll have a better fourth quarter. And next year is going to be a great year.”

President Trump’s reelection may depend on it. After overseeing three years of stock-market highs and historically low unemployment, the jobless rate soared in April to 14.7%, the worst since the Great Depression, the result of the government-ordered economic shutdown in response to the novel coronavirus pandemic.

White House economic adviser Kevin Hassett warned Sunday that Americans should expect more pain for at least another month, with the jobless rate expected to top 20% in May or June as initial claims for unemployment insurance arrive at a clip of about three million per week.

“I think that just looking at the flow of initial claims, that it looks like we’re probably going to get close to 20% in the next report, depending on whether the virus has really abated by that point and the economies are really going again,” Mr. Hassett said on CNN’s “State of the Union.” “Then it could head down from there.”

Mr. Hassett said he expected an upturn in the economic picture by mid-summer, citing the Congressional Budget Office’s forecast of a strong second-half bounce-back.

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