On Sunday, the Federal Reserve had slashed its interest rates by a complete percentage point and it has come near zero as it is going to be buying $700 billion in the Treasury Securities, a step which is aggressive for the insulation of the U.S. economy from the pandemic of coronavirus.
The outbreak of coronavirus had been harming the communities and the disruption in the economic activity in a lot of the countries as per the United States
The federal benchmark fund rate has now been given a range of 0-0.25% which is down from the range of 1-1.25. This cut brings the rate to zero essentially and that is something President Trump has been pressing on for the last year.
This is a historically low rate of interest that has not been given this level since the financial crisis of 2008 and has been expected to remain this way until the economy manages to recover from the downturn that has taken place recently
The committee has been expecting to maintain the target range till they are confident the economy has been able to weather the recent storms and is able to get back to the goals of maximum employment as well as stability of price. Fed said this Sunday evening in a statement.
Trump is very happy about the rate cut which is something he has been asking for a very long time. The Fed has also made a statement that it is going to be buying a minimum of $500 billion in the Treasury securities and the $200 billion in the mortgage backed securities in the coming months in the program which is called quantitative easing.
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