In Pandemic, Fed Showed Its Muscle in Markets Still Matters

In Pandemic, Fed Showed Its Muscle in Markets Still Matters
The Federal Reserve Board Building on Constitution Avenue in Washington on March 27, 2019. Brendan McDermid/Reuters
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The U.S. Federal Reserve’s response to the coronavirus pandemic began on Feb. 28 with a 44-word statement of faith in the economy from Chair Jerome Powell, an old-school measure aimed at calming nosediving financial markets.

Within weeks, though, its actions became so groundbreaking they cast the U.S. central bank as creditor to the world and open to frightening amounts of risky debt.