Central bank chiefs upbeat on vaccine boost to global economy

Central bank chiefs upbeat on vaccine boost to global economy

Powell, Lagarde and Bailey see uncertainty lifting but want continued support for recovery

Three of the world’s top central bankers predicted the breakthrough on a coronavirus vaccine would lift the uncertainty weighing on the global economy, while calling for more short-term public support to bridge the gap to a recovery.

Jay Powell, chair of the US Federal Reserve, said this week’s vaccine breakthrough was “certainly good and welcome news for the medium term”. But he warned that “significant challenges and uncertainties remain” on its timing, production, distribution and efficacy. 

“From our standpoint it’s just too soon to assess with any confidence the implications of the news for the path of the economy,” Mr Powell said at the ECB’s annual forum on central banking, which is being held online for the first time this year.

“The next few months could be challenging,” he added.

The global economic outlook received a big boost this week when Pfizer and Germany’s BioNTech said the vaccine they are jointly developing had proved 90 per cent effective in tests and could be approved for production this year.