are certainly welcome. moreover, in recent weeks, some other indicators suggest a stabilization or even a modest rebound in some segments of the economy. but activity in many parts of the economy has yet to pick up, and gdp is falling deeply below its recent peak. and, of course, despite the improvements seen in the may jobs report, the unemployment rate, at 13. 3 percent, remains historically high. after the extreme turbulence witnessed in march, financial markets across many sectors have normalized and are again serving their essential role of intermediating flows of savings and investment among borrowers and lenders. bank credit lines are providing liquidity to companies, and corporations with debt rated investment grade and high yield are able to issue, and in size, in the corporate bond market. i believe — and most outside observers agree — that this easing of financial conditions since march is, at least in part, the direct consequence of economic policy responses to the crisis, including the actions the federal reserve took at our march 15 meeting and the subsequent announcement and sequential launch of 11 new facilities to support the flow of credit to households and companies. while this easing of financial conditions is, of course, welcome to the extent that it supports the flow of credit to households and firms during this challenging period, it may not prove to be durable, depending on the course that the coronavirus contagion takes and the duration of the recession that it causes. at minimum, the easing of financial conditions is buying some time until the economy begins to recover. as i speak to you today, there is extraordinary uncertainty about both the depth and the duration of the economic downturn. because the course of the economy will depend on the course of the virus and the public health policies put in place to mitigate and contain it, there is an unusually 1 / 4 bis central bankers'speeches wide range of scenarios for the evolution of the economy that could plausibly play out over the next several years. in my baseline view, while i do believe it will likely take some time for economic activity and the labor market to fully recover from the pandemic shock, i do project right now that the economy will resume growth starting in the third quarter. in terms of inflation, my projection is for the covid - 19 contagion shock to be disinflationary, not inflationary, and the data we are seeing so far are consistent with this projection. for example, core cpi ( consumer price inflation ) prices fell 0. 4

richard h clarida : us economic outlook and monetary policy speech ( via prerecorded video ) by mr richard h clarida, vice chair of the board of governors of the federal reserve system, at the foreign policy association, new york city, 16 june 2020. * * * it is my pleasure to meet virtually this evening with the members and invited guests of the foreign policy association ( fpa ). 1 i am truly honored to receive the foreign policy association medal. past honorees have included sheila bair, anne - marie slaughter, paul volcker, jeanclaude trichet, and my federal open market committee ( fomc ) colleague john williams — and so with this award, i am indeed in select company. although i have been very much looking forward to receiving this award in person, that, of course, is not possible tonight, but i greatly look forward to attending a future dinner to convey in person my genuine appreciation to the members of the fpa for this special honor. since mid - march, i, along with my fomc colleagues, have been working from home. indeed, just last week, we held our scheduled june meeting via secure teleconference. and while i certainly miss the opportunities for face - to - face interactions along the corridors of the board ’ s eccles building, i am grateful to have the ability to work from home and want to convey my deep gratitude to all of those on the frontlines of the crisis, who are working outside the comfort of their homes in grocery stores, hospitals, and other businesses that provide essential services. current economic situation and outlook while the coronavirus ( covid - 19 ) pandemic has taken a tragic human toll measured in terms of lives lost and suffering inflicted, the pandemic has also inflicted a heavy toll on the levels of activity and employment in the u. s. economy, as a direct result of the necessary public health policies put in place to mitigate and control the spread of the virus. real gross domestic product ( gdp ) declined at a 5 percent annual rate in the first quarter of the year and will almost surely continue to contract at an unprecedented pace in the second quarter. the unemployment rate, which reached a 50 - year low of 3. 5 percent as recently as february of this year, surged to 14. 7 percent in april, an 80 - year high. in may, there was a notable rebound in employment and decline in unemployment, and these developments