Fed's Kaplan: Forecast is for a substantial contraction in Q2, 20% range annually

"The Fed is working furiously to work out the details on new programs," Dallas Fed President Robert Kaplan told Bloomberg TV on Friday.

"The Fed wants to make sure businesses and municipalities continue to function as we do social distancing to defeat the virus," Kaplan added. "The Fed's programs, fiscal bills are relief rather than stimulus."

Market reaction

The US Dollar Index largely ignored these comments and was virtually unchanged near 99.50 at the time of press.

Additional takeaways

"Forecast is for a substantial contraction in Q2, in the 20% range on an annualized basis."

"Unemployment could peak then quickly decline to 7% or 8% by end of year."

"Businesses may need to rescale, some may not return on the other side of this."

"Consumers may be more cautious coming out of this."

"Small and medium companies are worried about survival even with loan assistance."

"Expecting a shrinkage across the energy industry."

"We are in a self-mandated recession and believe have a great chance to come out of this strong."