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Dow drops 517 points after Fed's Powell warns of permanent economic damage without more stimulus

Dow drops 517 points after Fed's Powell warns of permanent economic damage without more stimulus
Brendan McDermid/Reuters



US stocks fell on Wednesday after Federal Reserve Chair Jerome Powell said a bumpy recovery is in store for the US economy.




Powell also said that "additional fiscal support could be costly, but worth it."




Despite "timely and appropriately large" relief policy, the economy's future "is both highly uncertain and subject to significant downside risks," Powell cautioned.




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US stocks tumbled on Wednesday after Federal Reserve Chair Jerome Powell warned of a slow economic recovery that may require more fiscal stimulus.
Investors looked to Powell's morning speech for clues about how the central bank may act further to pad the economic downturn - and what it expects the government to do. The chairman struck a decidedly negative tone and said that additional aid was likely needed to drag the economy out of its slump.
"While the economic response has been both timely and appropriately large, it may not be the final chapter, given that the path ahead is both highly uncertain and subject to significant downside risks," the Fed chair said in a webcast with the Peterson Institute for International Economics.
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