US Federal reserve mulls longer-term crisis-fighting plan

new york — Federal Reserve policymakers, still working to fully roll out a multi-trillion-dollar effort to shore up financial markets and an economy cratered by the coronavirus pandemic, last month dove into a new debate: how best to support the economy during a recovery they now agree could be slower and more fraught than initially thought.

Among ideas US central bankers discussed at April’s policy-setting meeting, according to minutes released Wednesday: more detailed guidance for the path of short-term interest rates, and capping longterm interest rates. The Fed used the former in the last crisis; the latter would be a first for the Fed.

It has slashed interest rates to near zero, bought trillions of dollars of bonds, and initiated a raft of lending programs, including one for mediumsized businesses which it hopes to launch later this month. At their April 28-29 meeting, policymakers re-upped a pledge to keep interest rates near zero until they are confident the US economy is on track to recovery. —