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Powell on COVID-19: 'The next few months could be challenging'

Yahoo Finance's Brian Cheung joins Kristin Myers to break down Jerome Powell's comments on COVID-19 during Thursday's ECB meeting.

Video Transcript

MYLES UDLAND: Nice pajamas.

ALEXIS CHRISTOFOROUS: Really? I say pajamas.

MYLES UDLAND: Oh, pajamas, pajamas, whichever.

- OK.

- Yahoo Finance. Watch today on Channel 604.

ALEXIS CHRISTOFOROUS: Welcome to the show.

MYLES UDLAND: Let's make finance make sense.

KRISTIN MYERS: Welcome back to Yahoo Finance Live. Let's talk now about Fed Chair Jay Powell and his latest comments in front of the European Central Bank. We're joined now by Yahoo Finance's fed whisperer, Brian Cheung, for more details. Hi, Brian.

BRIAN CHEUNG: Hi, Kristin. Well, it wasn't just Fed Chairman Jay Powell. It was also the heads of the European Central Bank, Christine Lagarde, in addition to the Bank of England, Andrew Bailey, speaking about how they're warning of the challenging next few months despite the fact that there has been positive developments on the vaccine front. Here's what Jay Powell said at a press-- or, rather, at a conference with the European Central Bank just earlier this morning.

JAY POWELL: You mentioned the vaccine. So that is certainly good and welcome news for the medium term, although significant challenges and uncertainties remain about timing, production, distribution, and the efficacy for different groups. And from our standpoint, it's just too soon to assess, with any confidence, the implications of the news for the path of the economy, especially in the near term. And I would say, with the virus now spreading, the next few months could be challenging.

BRIAN CHEUNG: We can hear right there, next few months will be challenging. The same is largely true in the jurisdictions of the eurozone and the United Kingdom, where the other central bank heads also represent. Christine Lagarde, at the ECB, saying she doesn't want to be, quote, exuberant about the vaccine. A lot of questions about the ability to produce that vaccine in mass, in addition to administering it. Whereas, in the UK, Andrew Bailey saying that his economists had already baked in expectations of developments on the vaccine front into its forecast. So unlikely that this will brighten that, per se.

But they did say that, broadly speaking, this does remove some of the uncertainty. But, obviously, as this stretches into a full-on year-- as we head into 2021-- of living with the virus globally, concerns about the long-term damage, people who have been disjointed or a basic distance from their jobs, whether or not there could be longer-term implications for getting those people back to work even when there is a vaccine in the future.