Fed's Powell: More spending to be needed from Congress

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The US Fed on late Wednesday kept interest rates unchanged near zero, vowing to do what it takes to support the economy, maintaining this target range until it is confident that the economy has weathered recent events.

"The ongoing public health crisis will weigh heavily on economic activity, employment, and inflation in the near term, and poses considerable risks to the economic outlook over the medium term," the bank said in a statement.

The Fed will continue buying Treasury, agency residential and commercial mortgage-backed securities in amounts needed to support market functioning and effective monetary policy transmission, it added.

Also, it will keep monitoring the implications of incoming information for the economic outlook, including information related to public health, as well as global developments and muted inflation pressures, and will use its tools and act as appropriate to support the economy.

Meanwhile, Fed Chairman Jerome Powell delivered a warning speech on Wednesday for Congress and the White House, saying more spending will be needed from Congress to avoid deeper economic collapse from the pandemic.

"We’re going to see economic data for the second quarter that’s worse than any data we’ve seen for the economy," he warned.

Powell said there could be a rebound in the economy as restrictions are lifted, however, he added: "It’s unlikely that it would bring us quickly all the way back to pre-crisis levels."

He added the economy may need more support from all of us if the recovery is to be a robust one.

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"We’re going to see economic data for the second quarter that’s worse than any data we’ve seen for the economy," he warned.

Powell said there could be a rebound in the economy as restrictions are lifted, however, he added: "It’s unlikely that it would bring us quickly all the way back to pre-crisis levels."

He added the economy may need more support from all of us if the recovery is to be a robust one.