Mnuchin says US economy poised for 'strong' reopening from coronavirus lockdown
Several signs point to a solid, phased reopening of the country, Mnuchin will say
Treasury Secretary Steven Mnuchin told Congress on Wednesday the U.S. economy is poised for a "strong" reopening from the coronavirus lockdown,
"America's economy has begun to rebound, and our recovery is underway," Mnuchin said in remarks prepared for his testimony before the Senate Committee on Small Business and Entrepreneurship.
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Several signs point to a solid, phased reopening of the country, Mnuchin said. That includes a Chamber of Commerce study published last week that found 79 percent of small businesses are either fully or partially opened. Still, the report found that 82 percent of small businesses remain concerned about the impact of the crisis.
The personal savings rate in the U.S. also surged to 33 percent in April, according to the Commerce Department’s Bureau of Economic Analysis, even as the coronavirus outbreak and related economic shutdown triggered a tidal wave of job losses, the pace and magnitude of which is without precedent.
Mnuchin's comments come on the heels of the surprisingly strong May jobs report. Consensus estimates predicted the economy lost somewhere around 9 million jobs in May, pushing unemployment to 20 percent -- the highest since the Great Depression. Instead, the Labor Department said employers actually added 2.5 million jobs last month, and the unemployment rate dropped to 13.3 percent.
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The report seemed to suggest the nation’s economy is starting to recover from the coronavirus pandemic, and the related lockdowns, faster and bigger than once believed possible.
"We remain confident that the overall economy will continue to improve dramatically in the third and fourth quarters," he said.
So far, Congress has passed three massive stimulus packages totaling nearly $3 trillion to blunt the economic pain from the outbreak of the virus. That includes the $2.2 trillion CARES Act, which established the Paycheck Protection Program, a fund that provides forgivable loans of up to $10 million to small businesses. If at least 60 percent of the money goes toward maintaining payroll, the federal government will forgive it.
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Mnuchin said the program is employing roughly 50 million workers and supporting the payroll of more than 75 percent of small businesses across the country.
"This is an extraordinary achievement," he said.
The Treasury Department has also distributed 160 million stimulus checks worth $260 billion; approved the disbursement of more than $27 billion to more than 500 airlines; and committed $200 billion in credit support for the Federal Reserve's lending facilities.