Some groups are bearing the brunt of the pandemic fallout, facing unemployment rates still higher than the national average, Powell told the committee.
Powell said he hoped these effects would be temporary, adding that it limited these workers’ ability to fully contribute to the economy.
At the end of the day, “policies that bring the pandemic to an end would help,” he said.
Senator Pat Toomey, the ranking member of the committee, said at the hearing’s start that he would prefer that the Fed did not stray from its core objectives of price stability and full employment to focus on racial inequality and climate change.
And while Powell acknowledged that fiscal policy, and not the blunt tools of monetary policy, are more appropriate to target issues of inequality, he continued to stress that added support for some groups is still necessary.
“The single best thing [the Fed] can do about that is to keep monetary policy accommodative,” he told the senators.
Powell will return to Capitol Hill Wednesday to testify before the House Financial Services Committee.