Investing.com | Nov 25, 2020 14:19
By Yasin Ebrahim
Investing.com - Federal Reserve policymakers expressed a willingness to persist with monetary policy support to keep the recovery on track as the impact of the pandemic continues to cast a cloud of uncertainty over the economic outlook, according to the minutes of the central bank's last policy meeting released Wednesday.
At the conclusion of its previous meeting on Nov. 5, the Federal Open Market Committee kept its benchmark rate in a range of 0% to 0.25% and pledged to maintain bond purchases at a $120 billion monthly pace.
The bond purchases have lowered longer term borrowing costs for businesses and households, and continue to help steer the economy through the pandemic.
In recent weeks, the sense of urgency to widen the liquidity spigot has been strengthened after Treasury Secretary Steven Mnuchin said he would allow the central bank's emergency lending programs – rolled out at the height of pandemic in March – to expire at year-end.
"The unilateral decision of Treasury Secretary Mnuchin to allow a slew of Fed emergency lending programs to close to new borrowers on December 31, despite Fed objections, increases the chance that the FOMC will step-up its asset purchases," Pantheon Macroeconomics said in a note.
The decision from Mnuchin was widely criticized as it comes as a time when another wave of coronavirus cases across the nation has seen parts of the U.S. impose lockdown measures that will slow the recovery.
Yet, hopes for a helping fiscal hand were given a boost on reports that President-elect Joe Biden will nominate former Fed Chair Janet Yellen as Treasury Secretary.
During her tenure as Fed Chair, Yellen was viewed as pro-stimulus, and if nominated is widely expected to support fiscal-boosting measures.
Treasury secretaries, however, don’t have direct control over fiscal policy. The former Fed Chair will likely have to contend with a Republican-held Senate that could keep fiscal policy options on a short leash somewhat.
Written By: Investing.com
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
Get free real time quotes, charts and alerts on stocks, indices, currencies, commodities and bonds. Get free top of the line technical analysis/predictors.
More content, faster quotes and charts, and a smoother experience is available only on the App.