Powell speech: Policy will remain highly accommodative until expansion is well along

Following the Federal Open Market Committee’s (FOMC) decision to keep the policy rate unchanged within the target range of 0-0.25%, Jerome Powell, Chair of the Board of Governors of the Federal Reserve System, is delivering his comments on the policy outlook.

Key quotes

“Borrowing from the Main Street Lending Program is closer to $2 billion now.”

“Main Street Lending Program reaches the whole nation and more banks and borrowers are joining.”

“Main Street can ramp up as needed.”

“Some lenders are concerned about underwriting expectations.”

“Main Street Program is a facility for borrowers that don’t have access to regular avenues for borrowing.”

“Fed is required to only make loans to solvent borrowers under emergency lending programs.”

“Many borrowers are in a situation where their businesses are shut down and they cannot service a loan and need more fiscal support.”

“Fed has to go through the banking system to implement Main Street Program and they are expected to do some underwriting.”

“Fed policy will remain highly accommodative until the expansion is well along, until we have a moderate overshoot of inflation for some time.

About Jerome Powell (via Federalreserve.gov)

Jerome H. Powell took office as Chairman of the Board of Governors of the Federal Reserve System on February 5, 2018, for a four-year term. Mr. Powell also serves as Chairman of the Federal Open Market Committee, the System’s principal monetary policymaking body. Mr. Powell has served as a member of the Board of Governors since taking office on May 25, 2012, to fill an unexpired term. He was reappointed to the Board and sworn in on June 16, 2014, for a term ending January 31, 2028.