Federal Reserve Chair Jerome Powell pauses during a news conference in Washington, earlier this month. The Federal Reserve announced late Wednesday that it would create a lending facility to back money market mutual funds battered by the coronavirus crisis. Jacquelyn Martin/AP hide caption
In its latest move to cushion the economic shock caused by the novel coronavirus pandemic, the Federal Reserve announced late Wednesday that it would create a lending facility to help ease the flow of credit and meet demand for money market redemptions by households and businesses.
In a statement released at 11:30 p.m. ET Wednesday, the Fed's Board of Governors said the Federal Reserve Bank of Boston would administer a new Money Market Mutual Fund Liquidity Facility (MMLF) to "make loans available to eligible financial institutions secured by high-quality assets purchased by the financial institution from money market mutual funds."
The move is apparently aimed at ensuring that the nearly $4 trillion money market fund industry can weather sudden redemptions by investors amid a major correction on Wall Street and a sharp upsurge in layoffs caused by the coronavirus crisis.
The announcement followed one earlier in the day meant to backstop the market for commercial paper — unsecured promissory notes issued by businesses to meet such short-term liabilities as payrolls, accounts payable and inventories. And on Sunday, the central bank lowered its benchmark federal funds rate to near zero and pledged to purchase $700 billion in Treasury securities and mortgage bonds.
The actions by the Federal Reserve are similar to those taken during the 2008 financial crisis.
The late-night announcement followed another brutal day on Wall Street, with the Dow Jones Industrial Average tanking another 6% — a continuation of a series of sharp drops in share prices that began last month, wiping out three years of gains.
"back" - Google News
March 19, 2020 at 05:35PM
https://ift.tt/3bcCl8H
Federal Reserve Establishes Lending Facility To Back Up Money Market Mutual Funds - NPR
"back" - Google News
https://ift.tt/2QNOfxc
Shoes Man Tutorial
Pos News Update
Meme Update
Korean Entertainment News
Japan News Update
Bagikan Berita Ini
0 Response to "Federal Reserve Establishes Lending Facility To Back Up Money Market Mutual Funds - NPR"
Post a Comment