The US Federal Reserve announced on Tuesday a new “credit facility” to help families and businesses withstand the spread of the Corona pandemic threatening the world’s largest economy.
The program, approved by the Treasury, targets debt such as loans and mortgages, a market that “has been reeling under great pressure in recent days as companies and families face a lot of uncertainty due to the spread of the Corona virus.”
“By ensuring that this market runs smoothly, especially in difficult times, the Federal Reserve provides loans that will support families, companies and jobs in all sectors of the economy,” the bank said.
This, in turn, “will enhance the ability of companies to retain employees and invest as the country deals with the spread of the Corona virus,” he said.
The Federal Reserve has taken several steps in the past two weeks to prevent the economy from freezing, including reducing the key lending interest to zero, and pumping a billion dollars into financial markets this week and 1.5 trillion dollars last week.
The Treasury will provide $ 10 billion in reserves, to allow the central bank to purchase loans from US companies or their subsidiaries next year.
The bank said that this facility “will encourage investors to participate again in lending in the financial loan market.”