FOMC

With only a fraction of the funds allocated being used, Federal Reserve Chair Jerome Powell said the central bank is considering tweaks to the middle-market rescue program in an appeal to lenders wary of taking on added risk.

The central bank said it would keep interest rates at current levels through at least to help the U.S. economy recover from the coronavirus pandemic.

Federal Reserve Chair Jerome Powell announced a new approach to monetary policy Thursday that takes a more relaxed stance on inflation and on its view of how low U.S. unemployment can go.

Two more Republican no votes will sink the nomination, if Democrats remain steadfast in their opposition.

The National Credit Union Administration will also discuss the current expected credit losses standard, which trade groups have argued that the industry should be exempt from.

Republican Sen. Mitt Romney of Utah said he will vote against Judy Shelton, one of two Trump administration nominees to the Federal Reserve’s Board of Governors.

The central bank is only now nearing the launch of the credit facilities after the effort was announced in April. But Chairman Jerome Powell said loans have been available through other means.

The Federal Reserve chairman pledged to use every tool at the central bank's disposal to limit the economic fallout from the coronavirus and urged lawmakers to take further action.

The latest version of the business lending initiative has $60 billion set aside for smaller lenders, including credit unions, but there are concerns the money will be allocated just as quickly this time as it was during the first round.

Economists also expect the Fed's balance sheet to more than $10 trillion as policymakers look to lift the country from a recession brought on by the coronavirus pandemic.

The Fed cuts rates near zero and will buy $700 billion in Treasuries and mortgage bonds; big banks put off stock buybacks until July at the earliest.

The Federal Reserve has voted unanimously to cut the interest rate 50 basis points to 1.10% effective March 4, in the first emergency rate cut since 2008.

The Fed chairman said he has not given up on the central bank agreeing with other regulatory agencies on a plan to modernize the Community Reinvestment Act, but admitted, "I don’t know whether that will be possible or not.”

Former Fed Chairman Paul Volcker is now synonymous with a provision of the Dodd-Frank law. But his legacy extends well beyond that.

Despite concerns over how regulatory requirements affect short-term funding markets, the central bank is not considering a reduction in the liquidity coverage ratio, Jerome Powell said.

CEOs have been telling investors that if the Fed continues to cut interest rates, they will lower rates they are paying on deposits to minimize the hit to net interest margins. The danger is that if they lower rates too quickly or by too much, big depositors could go elsewhere.

President Donald Trump urged the Federal Reserve to lower interest rates to a level typically reserved for recessions or periods of persistently weak growth, suggesting that such a setting could allow the government to restructure Treasury debt at a lower cost.

The Federal Reserve's monetary policies have exacerbated the wealth gap, making the central bank a vulnerable target for Trump. He’s taking full advantage.

“It wouldn't be unusual” for the Federal Reserve to work alongside private-sector operators in the creation of a U.S. real-time payments system, its chairman said.

The approach could work as long as the Fed were to add certain thresholds.