AP Economics Writer
WASHINGTON (AP) — Confronted with an economy gripped by recession and high unemployment, the Federal Reserve made clear Wednesday that it will keep supplying all the help it can by buying bonds to maintain low borrowing rates and forecasting no rate hike through 2022.
The Fed has cut its benchmark short-term rate to near zero. Keeping its rate ultra-low for more than two more years could make it easier for consumers and businesses to borrow and spend enough to sustain an economy depressed by still-widespread business shutdowns from the coronavirus.
Stock prices initially rallied modestly after the Fed issued its latest policy statement at 2 p.m. Eastern time before falling back into negative territory.
In the statement, which followed its lat