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Former New York Fed President: Even with the Covid-19 vaccine, the U.S. economy still needs more financial support

On Monday, Former New York Fed President Bill Dudley said that even though the possibility of widespread distribution of Covid-19 vaccine increases now, the US economy still needs financial assistance from Congress.

Recently, pharmaceutical companies have successively announced breakthroughs in the fight against the Covid-19. Moderna said on Monday that in a preliminary analysis of a large late-stage clinical trial, the effectiveness of its new crown vaccine reached 94.5%. A week ago, similar vaccines developed by Pfizer and BioNTech SE showed effectiveness of more than 90% in an interim analysis.

Dudley said that even with the good news of vaccines, a transitional fund of US$1 trillion to US$2 trillion is still needed to enable the affected individuals and businesses to get out of trouble.

“Therefore, I think this makes the reasons for fiscal stimulus more urgent in order to achieve a stronger economic recovery. There is still a long way to go in reducing the trauma to the economy.” Dudley said.

But the two parties in the United States have been unable to reach a tradeoff to support the close to expired $2.2 trillion CARES bill which passed in March.