Federal Reserve Chair Jerome H. Powell said on Tuesday that the U.S. is “closely monitoring the emergence of the coronavirus, which could lead to disruptions in China that spill over to the rest of the global economy.”
The coronavirus, which spreads from person to person, has affected over 40,000 people worldwide and caused more than 1,000 deaths in China. There is no vaccine or specific treatment so far.
“The question for us is what will be the effects for the U.S. economy? Will they be persistent? Will they be material?” Powell said while testifying in front of Congress on Tuesday.
“I think it’s just too early to say. We have to resist the temptation to speculate on this. So, we’ll be watching that carefully," he said.
Still, Powell said the central bank is holding interest rates steady for now.
Here’s Powell’s full statement on the coronavirus:
“Of course, first we observe the human tragedy, which is terrible to watch. But the question for us really is what will be the effects on the U.S. economy? Will they be persistent? Will they be material? That’s really the question. I think we know there will be effects on China through some part of the first half of the year and China’s close neighbors and major trading partners in Europe as well as Asia. And we know that there will very likely be some effects on the United States. I think it’s just too early to say. We have to resist the temptation to speculate on this. So, we’ll be watching that carefully.”
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