Fed Promises Unlimited QE, Corporate Bond Buying, Muni Buying, and Main Street Credit
The Federal Reserve said Monday it will purchase unlimited amounts of Treasuries and mortgage-backed securities and buy corporate bonds, municipal bonds, and asset-backed securities for the first time.
The Fed announced a major expansion of its programs to support the economy on Monday morning following several days of frantic moves by the central bank to expand its support for credit and money markets. Fiscal support for the economy, in the form of spending and lending programs from the federal government, stalled on Capitol Hill over the weekend.
The Federal Open Market Committee, the Fed’s monetary policymaking unit, said it would purchase Treasury and mortgage securities “in the amounts needed to support smooth market functioning and effective transmission of monetary policy to broader financial conditions and the economy.”