The most striking thing is the unrestricted asset purchase plan, until the market runs smoothly and monetary policy effectively improves the financial situation and economy.
FOMC previously announced the purchase of $500 billion in US Treasury bonds and at least $200 billion in mortgage-backed securities. AP Storage will purchase US bonds and MBS as needed, and the expected interest rate of daily and regular repurchase will be reset to 0%.
In the statement, FOMC announced that it would extend the scope of bond purchase to institutional mortgage-backed bonds. This week, it was announced that it would purchase $75 billion of treasury bonds and $50 billion of institutional housing loan-backed securities every day to expand the scale of liquidity facilities in the money market.
At the same time, AP Storage announced the establishment of two new liquidity instruments for corporate debt, namely, the primary market corporate credit instrument (PMCCF) and the secondary market corporate credit mechanism (SMCCF), and restarted the fixed-term asset-backed securities loan mechanism (TALF) established in 2008.
Associated Press supports the flow of credit to employers, consumers and enterprises by formulating new plans, which together provide $300 billion in new financing. The US Treasury will use the Foreign Exchange Stabilization Fund (ESF) to provide shareholders with $30 billion.
In addition, Asia-Pacific Bank has promoted the credit flow to municipalities by expanding the joint fund liquidity instrument (MMLF) to include a wider range of securities, and by expanding the commercial paper financing mechanism (CPFF) to include high-quality, tax-free commercial paper as qualified securities.
In addition to the above measures, the Federal Reserve is expected to announce the establishment of a commercial loan plan for small and micro enterprises, support qualified loans for small and medium-sized enterprises, and supplement the efforts of the Small and Micro Enterprise Administration (SBA).
The epidemic of coronavirus has brought great difficulties to the United States and other parts of the world, AP Store said in a statement. China's priority is to take care of the victims and limit the further spread of the virus. Although there is still great uncertainty, it is obvious that our economy will face serious damage. We should make active efforts in the public and private sectors to limit the loss of work and income and promote rapid recovery after the interference is eliminated.
Consulting firm Bleakley, Group Chief Investment Officers Peter and Boockvar said in the report: We are now in an infinite QE state again.
Chris, chief financial economist of MUFGUnionBank, wrote in a letter to Rupkey: The policy of AP storage is turning to a higher level, hoping to support the economy that seems to be falling freely now. The central bank is no longer the lender of last resort, but the buyer of last resort. Don't ask how much they buy. This is real infinite quantitative easing.