Fed: market waiting again for collapse in case of absence of effective measures against pandemic

Most experts predict a moderate economic recovery, both in the United States and elsewhere, but the uncertainty about its prospects is particularly high. The consequences of proliferation coronavirus has weakened the protection of the financial system from future shocks, including from repeated outbreaks of the pandemic. This assessment is contained in a recent report by the Federal Reserve, released on Monday. The spring quarantine dealt a tangible blow to businesses and households. If the financial situation of the most affected continued to deteriorate, it could have negative consequences for the financial system as a whole. At the same time, monetary and fiscal instruments to support the economy in cases where the crisis is caused by medical factors can only help partially, the document says. If the second wave of coronavirus drags on, additional damage to the United States economy could disrupt the fragile recovery, the Fed warns.