Fed tells banks relaxed COVID capital rules ending
Tax hikes from COVID stimulus will slow economy: Former Trump senior adviser
Former Trump senior adviser Kevin Hassett discusses the impact of the COVID-19 stimulus on tax increases and his outlook for the economy.
The Federal Reserve told U.S. banks that capital requirements loosened as the coronavirus pandemic raged will return to normal at the end of the month.
As of March 31, bank requirements to meet the so-called supplementary leverage ratio will snap back to pre-pandemic levels. The eased rules were part of the Fed's emergency actions to stabilize the financial system, Treasury market and to boost lending.
FED CHAIR POWELL SAYS THE CARES ACT AND OTHER RESCUE EFFORTS SAVED THE ECONOMY FROM ARMAGEDDON
"To ease strains in the Treasury market resulting from the COVID-19 pandemic and to promote lending to households and businesses, the Board temporarily modified the SLR last year to exclude U.S. Treasury securities and central bank reserves," the Fed said in a statement. "Since that time, the Treasury market has stabilized."
DOW TUMBLES AS FINANCIALS DRAG ON FED NEWS
|JPM||JPMORGAN CHASE & CO.||152.75||-5.04||-3.19%|
|GS||THE GOLDMAN SACHS GROUP, INC.||343.36||-4.82||-1.38%|
|BAC||BANK OF AMERICA CORP.||38.30||-0.68||-1.73%|
|WFC||WELLS FARGO & CO.||39.81||-1.01||-2.47%|
Financial stocks dipped on concerns banks may need to shift capital to meet the requirements. However, the change is also a sign the U.S. economy is stabilizing.
FED HOLDS RATES NEAR ZERO, BUT LIFTS GROWTH OUTLOOK AS US ECONOMIC RECOVERY STRENGTHENS
Earlier this week, the policymakers reiterated their commitment to keep rates near zero and also upgraded their economic projections.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
Source: Read Full Article