US Federal Reserve head Jerome Powell sets out a bleak economic outlook, amid the Trump Administration’s mismanagement of the Coronavirus crisis, with infection rates rising again in 21 states.

Powell said on Wednesday that the the labor market might have “hit bottom” in April, with an inaccurate headline rate of 14.7% unemployment and an estimated actual rate of more than 20%.

However, he indicated millions of people will remain out of work for an extended period with unemployment at 9.3% by the end of 2020.

The US unemployment rate was 3.5% in February, before the rapid spread of the pandemic. More than 42 million Americans have filed for unemployment benefits since mid-March.

The US death toll reached 112,924 on Wednesday, an increase of 918 in 24 hours. While the national rate of increase has been halted, daily deaths have continued at about 1,000 this month.

Confirmed cases broke the 2 million mark, now standing at 2,000,464.

Powell said at a news conference after the Fed’s two-day policy meeting, “This is the biggest economic shock, in the US and the world…in living memory. We went from the lowest level of unemployment in 50 years to the highest level in close to 90 years, and we did it in two months.”

The Fed chief said “there is great uncertainty” about the future: “My assumption is that there will be a significant chunk, well into the millions…[of workers] who don’t get to go back to their old job, and, in fact, there may not be a job in that industry for them for some time.”

Infections Up After Quick Re-Opening

Dr. Anthony Fauci, the White House’s top infectious disease expert, warned on Tuesday that the Coronavirus pandemic is far from over: “Where is it going to end? We’re still at the beginning of it.”

But the Trump Administration has sidelined its medical advisors, including Fauci. White House daily briefings were suspended in late April, after Donald Trump’s suggestion that ingestion of disinfectant and ultraviolet treatment would cure the virus. While Trump stepped back from his threat to disband the White House Coronavirus Task Force, it has had no visibility since then.

With the advisors pushed advisor, Trump’s inner circle pursued their headline message of “reopening” the US, irrespective of the health risks.

However, latest data indicates that the lifting of restrictions has contributed to a resurgence of Coronavirus in 21 states.

The fastest rates of increase are in states with Republican governors who followed Trump’s lead with rapid moves against stay-at-home and social distancing measures. They include Florida, Texas, Arizona, and South Carolina.

Other states where rates were declining but have turned upward include Oklahoma. Trump, worried about his poll position ahead of November’s elections, said on Wednesday that he will hold a rally in Tulsa on June 19. There will be no social distancing rules.

Trump’s Denial

Trump’s months-long denial of the seriousness of Coronavirus has continued with his denial of any economic problem.

He said last month, without evidence, “I think you’re going to have a V. I think it’s going to be terrific.”

Last week he used a snap White House appearance to proclaim “victory” with an announced decrease in the unemployment rate to 13.3%, even though this was still almost four times the February figure.

And even that 13.3% was wrong. The Bureau of Labor Statistics admitted hours later that they had not counted millions of furloughed workers, raising the official rate to 16.3%. When those who have dropped out of the workforce are included, the effective rate tops 20%.

Trump’s position was undercut on Wednesday as Fed officials said they expected the unemployment rate to still be at 5.5% in 2022.

Output is expected to contract by 6.5% this year, before rebounding 5% in 2021.

Treasury Secretary Steven Mnuchin acknowledged at a Senate committee hearing that some parts of the economy had sustained “significant damage”.

“I definitely think we are going to need another bipartisan legislation to put more money into the economy,” Mnuchin said.

Trump did not mention the economic news, including Powell’s assessment, on Wednesday. Instead he defied conflict-of-interest rules to promote his business.