Finance and Economics Discussion Series (FEDS)
June 2021
The COVID-19 Crisis and the Federal Reserve's Policy Response
Richard H. Clarida, Burcu Duygan-Bump, and Chiara Scotti
Abstract:
The COVID-19 pandemic and the mitigation efforts put in place to contain it delivered the most severe blow to the U.S. economy since the Great Depression. In this paper, we argue that the Federal Reserve acted decisively and with dispatch to deploy all the tools in its conventional kit and to design, develop, and launch within weeks a series of innovative facilities to support the flow of credit to households and businesses. These measures, taken together, provided crucial support to the economy in 2020 and are continuing to contribute to what is expected to be a robust economic recovery in 2021.
Accessible materials (.zip)
Keywords: monetary policy, forward guidance, asset purchases, section 13(3) facilities
DOI: https://doi.org/10.17016/FEDS.2021.035
PDF: Full Paper
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