FED CLAIMS IT’S USING ‘FULL RANGE OF TOOLS’ VS PANDEMIC’S IMPACT
The Federal Reserve is promising to use its “full range of tools” to pull the country out of a recession brought on by a global pandemic, signaling that it would keep interest rates low through 2022, Martin Crutsinger wrote for the Associated Press (AP) on June 13, 2020.
In its semi-annual monetary policy report to Congress, the central bank said Friday that the COVID-19 outbreak was causing “tremendous human and economic hardship across the US and around the world.”
In response, the Fed said it’s “committed to using its full range of tools to support the US economy in this challenging time.” The Fed’s report comes two days after a policy meeting where the central bank kept its benchmark interest rate at a record low of zero to 0.25% and signaled that it planned to keep it there through 2022. The Fed said it would continue to buy billions of dollars of Treasury and mortgage-backed securities to support the financial market as it warned that the recovery might be slow.
Federal Reserve Chairman Jerome Powell will testify before congressional committees for two days next week, starting Tuesday, on the new report. Lawmakers are expected to ask Powell to explain how the central bank plans to further support the economy during what is expected to be the steepest economic downturn in the last 70 years.