The Federal Reserve on Wednesday committed itself to use its full range of tools to help the U.S. economy which is facing considerable risks from the coronavirus pandemic.
“The ongoing public health crisis will weigh heavily on economic activity, employment and inflation in the near term, and poses considerable risks to the economic outlook over the medium term,” the Fed said in a statement after two-day meeting.
The Fed kept its benchmark interest rate in a range from 0 to 0.25% as expected and repeated it would hold monetary policy steady until the economy has weathered recent events and “is on track” to achieve full employment and price stability. That is unchanged from the March forward guidance.
Fed Chairman Jerome Powell will hold a press conference at 2:30 p.m. Eastern
The economy is reeling as the stay-at-home orders designed to stop the spread of the COVID-19 pandemic have brought business and personal activity economy to a standstill. The service economy typically can power through a recession but not a quarantine. There are now 26 million Americans who have been laid off over the past five weeks. Economic activity in the first quarter contracted at a 4.8% annual rate and economists expect an even larger drop in the April-June quarter.
Stocks were trending higher midday Wednesday on optimism about a drug manufacturer’s coronavirus treatment. The Dow Jones Industrial Average
was up over 500 points.
The yield on the 10-year Treasury note
was down slightly to 0.606%. Yields are down from the 52-week high of 2.552% hit last May.
Source : MTV