This racial reckoning comes against the backdrop of the COVID-19 pandemic and the stark social disparities that it has revealed, calling on policy makers to directly address concerns about structural racism and the economic inequalities that it creates. The pandemic is also making pre-existing racial disparities worse. For example, unemployment in June for white Americans fell to 12.4% while it continued to rise to 16.8% for Black Americans.

As the Federal Reserve (the Fed) plays a central role in the economic rescue, Fed Chair Jerome Powell has acknowledged the urgency of addressing racial inequality in the US and pledged that “there is no place at the Federal Reserve for racism” and that “the Federal Reserve serves the entire nation.” 

However, this fact sheet points out serious inequities in the Fed’s overall economic rescue efforts to date that will exacerbate racial inequality, and highlights how the Fed’s policy choices regarding its municipal lending program are badly undermining even its modest efforts to help Black workers. Download the fact sheet to read more.