Powell Promises Fed Remains "Committed To Using Every Tool" To Save The World From Virus' "Considerable Risks"

Broadly speaking, markets don't expect big policy decisions at today’s FOMC - After all, with rates at zero and QE already "unlimited" what can the Fed do absent announcing negative rates and starting to buy stocks (it will likely pursue both, but it first needs another market crash.)

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So what did they say...

Pretty obvious and expected:  Fed says it will do all it can to help the economy still facing considerable risk

The Federal Reserve on Wednesday committed itself to use its full range of tools to help the economy facing considerable risk 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 rate close to zero and repeated it would hold policy steady until the economy has weathered recent events and "is on track" to achieve full employment and price stability.

"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. "

That is unchanged from the March's broad-based forward guidance.

In addition to inflation the Fed will now be monitoring incoming health data:

"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"

Finally, we note that The Fed offers no guidance on future QE (which we noted above is tapering rapidly), and surprised many Fed-watchers with a lack of actual quantitative forward guidance on asset purchases, timing, rates, inflation, or bubble size.

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Power Hedge 8 months ago Contributor's comment

The more I see what the Fed is doing, the more confident I am in buying precious metals.

Peter Craig 8 months ago Member's comment

Agreed.

Linda Willis 8 months ago Member's comment

Couldn't have said it better myself.