Stocks suffered a similar sell-off when Wall Street first heard of the Delta variant, but it quickly recovered and surged to new record highs as vaccine availability spread and health officials spread. learned how to better manage the pandemic.
In his prepared testimony, Powell noted that the economy took a big hit over the summer as the Delta variant spread globally. Many Americans are afraid to travel, shop, eat at restaurants, and go back to the office. That kept caregivers at home, exacerbating labor shortages and a supply-chain crisis that has gripped the US economy.
The economy was already in recession and flowing with the epidemic rising and falling, and Omicron threatened to undo much of the economic goodwill the US had built during the fall months.
“Grower concerns about the virus could reduce people’s willingness to do in-person work, which will slow progress in the labor market and intensify supply chain disruptions,” Powell wrote in the letter. his testimony.
Inflation could be here for a little longer, Mr. Powell said. It’s a bit of a Catch-22: The labor shortage has driven wages (and prices) higher. But with job growth accelerating in recent months, employers are finding fewer people applying for their existing jobs — and they’re having to raise wages to attract new workers.
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