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U.S. Markets

Fed's Bullard: Expanded unemployment pay not appropriate as recovery takes hold

FILE PHOTO: St. Louis Federal Reserve Bank President James Bullard speaks at a public lecture in Singapore October 8, 2018. REUTERS/Edgar Su

WASHINGTON (Reuters) - Expanded unemployment benefits were an appropriate policy during the coronavirus shut down but would not be appropriate as the recovery takes hold, St. Louis Federal Reserve president James Bullard said on Wednesday.

Instead policymakers should consider incentives for workers to return to jobs if asked. “That 100% replacement rate is totally appropriate during the pandemic adjustment...It would not be appropriate as we come out of it,” Bullard said. “You want to incentivize people” to work. Workers are currently given an extra $600 per week in unemployment, but the additional benefit expires at the end of July.

Reporting by Howard Schneider, Editing by Franklin Paul

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