The Federal Reserve kept rates unchanged, kept QE infinity open with TALF for open-ended Treasuries, MBS and corporate bonds in amounts needed. Fed will continue to assess Cornoavirus damages to the economy.
The Federal Reserve kept rates unchanged, kept QE infinity open with TALF for open-ended Treasuries, MBS and corporate bonds in amounts needed. Fed will continue to assess Cornoavirus damages to the economy.
Federal Reserve Emergency FOMC Statement
Federal Reserve Announcement Wed 29 April 2020 14:00:00 ET
FOMC Benchmark Interest Rate Target Range UNCH .00-0.25%
Interest Rate On Excess Reserves UNCH .10%
Conference To Follow At 2.30 ET PM With Chairman Powell
Highlights
- Rates unchanged in a range of 0.00%-0.25%, as expected
- Fed says rates to stay at lower bound until economy has weathered recent events and on track to achieve unemployment and inflation goals
- Interest on excess reserves unchanged at 0.10%
- Public health crisis will weigh heavily on the economy, employment and inflation in the near term
- Will monitor incoming information for economic outlook and public health along with global developments in setting policy
- Will continue buying Treasuries, agencies and commercial MBS in amounts needed
- Will continue to offer large-scale repos
- Disruptions to economic activity in US and broad have significantly affected financial conditions
- Fed funds rate 2-year projection vs 1.6% prior
- Fed funds rate 3-year projection vs 1.9% prior
- Fed funds rate long-term projection vs 2.50% prior
April 29 For release at 2:00 p.m.EDT
The full FOMC statement for April 29 2020
The Federal Reserve is committed to using its full range of tools to support the U.S. economy in this challenging time, thereby promoting its maximum employment and price stability goals.
The coronavirus outbreak is causing tremendous human and economic hardship across the United States and around the world. The virus and the measures taken to protect public health are inducing sharp declines in economic activity and a surge in job losses. Weaker demand and significantly lower oil prices are holding down consumer price inflation.
The disruptions to economic activity here and abroad have significantly affected financial conditions and have impaired the flow of credit to U.S. households and businesses. 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. In light of these developments, the Committee decided to maintain the target range for the federal funds rate at 0 to 1/4 percent.
The Committee expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals. The Committee will continue to monitor the implications of incoming information for the economic outlook, including information related to public health, as well as global developments and muted inflation pressures, and will use its tools and act as appropriate to support the economy.
In determining the timing and size of future adjustments to the stance of monetary policy, the Committee will assess realized and expected economic conditions relative to its maximum employment objective and its symmetric 2 percent inflation objective. This assessment will take into account a wide range of information, including measures of labor market conditions, indicators of inflation pressures and inflation expectations, and readings on financial and international developments.
To support the flow of credit to households and businesses, the Federal Reserve will continue to purchase Treasury securities and agency residential and commercial mortgage-backed securities in the amounts needed to support smooth market functioning, thereby fostering effective transmission of mnetary policy to broader financial conditions.
In addition, the Open Market Desk will continue to offer large-scale overnight and term repurchase agreement operations. The Committee will closely monitor market conditions and is prepared to adjust its plans as appropriate.
Voting for the monetary policy action were Jerome H. Powell, Chair; John C. Williams, Vice Chair; Michelle W. Bowman; Lael Brainard; Richard H. Clarida; Patrick Harker; Robert S. Kaplan; Neel Kashkari; Loretta J. Mester; and Randal K. Quarles.
Apr 29 FOMC STATEMENT CHANGES (Mar 15th/Apr 29th):Vvi RANsquawk @RANsquawk
Source: Federal Reserve
From the TradersCommunity Research Des