Washington (AFP)

The economic crisis caused by the pandemic presents "fundamental differences" with the Great Depression and growth should resume faster despite very high unemployment and a deep recession, said Sunday the boss of the American Central Bank, Jerome Powell.

"I don't think this is a likely outcome at all," said Powell in a CBS interview about a Great Depression like the 1930s. He cited a booming economy before the pandemic, strong banks and an adequate response from the authorities.

However, he believes that a peak in the unemployment rate at 20 or 25% is likely, and that the drop in US GDP in the second quarter in the United States will be "easily in the 20, 30%".

The American economy has been severely slowed down by containment measures imposed on the majority of the country's population in an attempt to stem the epidemic which has already killed nearly 90,000 people in the country and infected nearly one million and a half million, according to available data compiled by Johns Hopkins University. The United States has the highest number of deaths in the world.

The head of the central bank said it was impossible "to find the words to express the suffering" inflicted by the disease, but wanted to be optimistic for the economy in the longer term.

"In the long term and even the medium term, I would really advise against betting against the US economy. This economy will recover," said Powell. However "it will undoubtedly take a little time, or even a certain time, that could go until the end of next year, in fact we know nothing about it".

In total, almost 36.5 million people have been unemployed since the sudden cessation of economic activity in mid-March, and the unemployment rate climbed jumped from 3.5% in February to 14.7% in April. All indicators have collapsed, from growth (-4.8% year-on-year in the 1st quarter) to manufacturing, the traditional engine of the American economy, via manufacturing production.

Powell said on Wednesday that he did not believe in a "V-shaped" recovery, a sharp fall followed by a very rapid return to growth. And he had called on elected officials to do everything, even if it proves costly, to avoid a long recession whose deleterious effects would once again hit the most vulnerable populations.

On Sunday, he reiterated his prediction of a slower recovery than he had previously envisaged, but nevertheless judged that the economy could restart "as of the third quarter".

- Health statistics -

But beyond the economic indicators that the Central Bank compiles and tries to anticipate, Mr. Powell stressed that the time was mainly to control the pandemic, in the absence of vaccine or treatment having proven therapeutic .

The debate is raging in the United States between supporters of a rapid reopening of the economy and those of a slow and reasoned opening to try to avoid a second wave of infections.

"You know, the thing that matters more than anything else at the moment is the health indicators. It is the spread of the virus. These are all these things that are associated with it" such as measures of social distancing, a explained Mr. Powell.

For him it is a sine qua non condition for the economy to be able to restart.

Powell also said on Sunday that the world's largest economy could not fully recover from the shock of the pandemic without a vaccine.

"If we assume that there will be no second wave [of coronavirus infections], I think the economy will gradually heal throughout the second half of the year," said Powell.

"However, for the economy to recover fully, people need to regain full confidence. It may be necessary to wait for the arrival of a vaccine," said Powell.

The Trump administration has retained 14 vaccine candidates and promises to be able to deliver hundreds of millions of doses to the U.S. population by January. A too optimistic promise according to some experts.

© 2020 AFP