Fed Chairman Powell says GDP could shrink more than 30%, but he doesn’t see another Depression

CNBC reports that the U.S. economy could shrink by upwards of 30% in the second quarter but will avoid a Depression-like economic plunge over the longer term, Federal Reserve Chairman Jerome Powell told "60 Minutes" in an interview aired Sunday.

The central bank chief also conceded that jobless numbers will look a lot like they did during the 1930s, when the rate peaked out at close to 25%,

However, he said the nature of the current distress coupled with the dynamism of the U.S. and the strength of its financial system should pave the way for a significant rebound.

Asked by host Scott Pelley whether unemployment would be 20% or 25%, Powell said, "I think there're a range of perspectives. But those numbers sound about right for what the peak may be." Pressed on whether the U.S. is headed for a "second depression," he replied, "I don't think that's a likely outcome at all. There're some very fundamental differences."

He said that growth could return in the third quarter.

"I think there's a good chance that there'll be positive growth in the third quarter. And I think it's a reasonable expectation that there'll be growth in the second half of the year," Powell said. "I would say though we're not going to get back to where we were quickly. We won't get back to where we were by the end of the year. That's unlikely to happen."