MNI POLICY: Fed Vows To Use All Tools to Combat Covid-19

By Pedro Nicolaci da Costa

     WASHINGTON (MNI) - The Federal Reserve on Wednesday committed to "using its

full range of tools" to combat an economic slump caused by the coronavirus that

could last longer than previously anticipated.

     "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 Federal Open Market Committee said

in a sharply overhauled statement.

     The Fed emphasized its aggressive recent actions, which included sharp cuts

to official interest rates and the launch of several emergency credit

facilities.

     It maintained a commitment to keeping rates at zero and purchasing bonds

until the economy appears to be on track to a full recovery.

     Key points from the statement:

*No changes to IOER 

*No changes to forward guidance 

*Stronger commitment to using full range of tools -- Fed sees weak inflation due

to weaker demand, lower oil prices

--MNI Washington Bureau; +1 202 371 2121; email: pedro.dacosta@marketnews.com

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