President Donald Trump's announcement that there will be no more economic talks until after the November elections will hurt efforts to bring the economy back from its coronavirus pandemic-induced decline, said Loretta Mester, president of the Cleveland Federal Reserve , on Tuesday.
"Sure, you know, the recovery will continue without them I think, but it's going to be a much slower recovery and it's disappointing that we didn't get a package ready," Mester said on CNBC's "Closing Bell" just a little while after Trump delivered the stimulus messages.
"There are still a lot of households and a lot of small businesses that really need that kind of help and while the recovery has been a little stronger than many of us thought we are still in a pretty big hole," she added .
The remarks helped end a hurricane in which Fed Chairman Jerome Powell, who previously spoke with the National Association for Business Economics, called for more tax support for workers and businesses still in need.
In the afternoon, however, Trump announced that he had instructed his negotiators to hold off talks until after the November 3 elections. During the talks, the Democrats had sought a much more aggressive spending package than the White House agreed to sign after both sides agreed in March on the CARES bill, which provided for more than $ 2 trillion in aid.
Despite the relief, GDP fell 31.4% in the second quarter but is on track to offset most of those losses in the third quarter. However, most economists expect a much slower rate of growth, and employment gains from May to August began to slow in September.
The Fed itself has been active in the business cycle, lowering the benchmark's short-term benchmark interest rates to near zero, and introducing more than a dozen programs for corporate lending and the functioning of financial markets.
Although Mester said the Fed is always ready to provide help where it can, she said it was "very happy" with current policies.
"We do our part," she said. "I think the tax authorities, who got in very well with a lot of help in the beginning, now have to do more."
Mester added that she believes the country needs to continue investing in health measures alongside tax and financial aid to contain and eradicate the virus.
"Investing in things that can actually improve our ability to test, detect and obtain a vaccine would be extremely powerful," he said.