In its two-day session, the United States Federal Reserve System (FED) agreed to keep the basic interest rate in a range of 0 to 0.25%
Central bank representatives also pledged to use the full range of tools to save the American economy.
The coronavirus pandemic has caused enormous economic and human difficulties across the United States and around the world, a statement by the Federal Open Market Committee. The United States is willing not only to keep the basic interest rate close to zero, but to use all possible instruments to avoid the unprecedented fall of the country’s economy.
According to data on the development of the United States’ Gross Domestic Product, published by the Department of Commerce, the total volume of production decreased by almost five percent, calculated on an annual basis. Since the quarantine measures were implemented, more than 26 million Americans have submitted their applications for unemployment benefits, which it appears will continue to increase significantly.
“I don’t think unemployment can drop to its December lows anytime soon,” Jerome Powell, the Fed’s chief, said during a press conference on Wednesday. According to Powell, the possibility that the country’s economy requires an even stronger stimulus than it seemed so far cannot be excluded. Some economists estimate that the US GDP slump in the second quarter may be unprecedented in the country’s history, reaching as high as 40 percent, calculated on an annual basis.