Federal Reserve issues FOMC statement

The removed: coronavirus outbreak has harmed communities and disrupted economic activity in many countries, including the United States. Global financial conditions have also been significantly affected. Available economic data show that added: Federal Reserve is committed to using its full range of tools to support the U.S. economy removed: came into added: in this challenging removed: period on a strong footing. Information received since the Federal Open Market Committee met in January indicates that the labor market remained strong through February and economic activity rose at a moderate rate. Job gains have been solid, on average, in recent months, and the unemployment rate has remained low. Although household spending rose at a moderate pace, business fixed investment and exports remained weak. More recently, the energy sector has come under stress. On a 12‑month basis, overall inflation and inflation for items other than food and energy are running below 2 percent. Market-based measures of inflation compensation have declined; survey-based measures of longer-term inflation expectations are little changed.

removed: Consistent with added: time, thereby promoting its removed: statutory mandate, the Committee seeks to foster maximum employment and price removed: stability. added: stability goals.

The removed: effects added: 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 removed: the coronavirus added: credit to U.S. households and businesses.

added: The ongoing public health crisis will weigh added: heavily on economic removed: activity added: activity, employment, and inflation in the near removed: term added: term, and removed: pose added: poses considerable risks to the economic removed: outlook. added: outlook over the medium term. In light of these developments, the Committee decided to removed: lower added: maintain the target range for the federal funds rate removed: to added: 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. removed: This action will help support economic activity, strong labor market conditions, and inflation returning to the Committee's symmetric 2 percent objective.

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.

removed: The Federal Reserve is prepared to use its full range of tools to added: To support the flow of credit to households and removed: businesses and thereby promote its maximum employment and price stability goals. To support added: businesses, the removed: smooth functioning of markets for added: Federal Reserve will continue to purchase Treasury securities and agency removed: mortgage-backed securities that are central to the flow of credit to households added: residential and removed: businesses, over coming months the Committee will increase its holdings of Treasury securities by at least $500 billion and its holdings of agency mortgage-backed securities by at least $200 billion. The Committee will also reinvest all principal payments from the Federal Reserve's holdings of agency debt and agency added: commercial mortgage-backed securities in removed: agency mortgage-backed securities. added: the amounts needed to support smooth market functioning, thereby fostering effective transmission of monetary policy to broader financial conditions. In addition, the Open Market Desk removed: has recently expanded its added: will continue to offer large-scale overnight and term repurchase agreement operations. The Committee will removed: continue to 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; added: Loretta J. Mester; and Randal K. Quarles. removed: Voting against this action was Loretta J. Mester, who was fully supportive of all of the actions taken to promote the smooth functioning of markets and the flow of credit to households and businesses but preferred to reduce the target range for the federal funds rate to 1/2 to 3/4 percent at this meeting.

removed: In a related set of actions to support the credit needs of households and businesses, the Federal Reserve announced measures related to the discount window, intraday credit, bank capital and liquidity buffers, reserve requirements, and—in coordination with other central banks—the U.S. dollar liquidity swap line arrangements. More information can be found on the Federal Reserve Board's website.