The Fed renews its commitment to keep interest rates close to zero

the makers of the federal Reserve renewed their commitment to keep interest rates close to zero until they are convinced that the u.s. economy is poised to rebound, according to a detailed account of their last meeting published on Wednesday.

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The participants agreed "to use the tools of the Committee and act in an appropriate manner to support the economy," according to the minutes of the meeting, which took place on 28 and 29 April. Their recent interventions have been "essential" to reduce the risk of downward revision of economic forecasts, they stress. Several of them have, however, referred to "a substantial likelihood of further waves of epidemic in the short or medium term" and the "minutes" suggests that the central bankers may need to be ready to use their extraordinary powers for a period of time.

Pledge to support the economy

At the meeting, the Fed officials have left interest rates near zero and reiterated their promise to do the necessary to support the economy, on which the pandemic due to the coronavirus poses "considerable risks" to the medium-term.

More than 36 million Americans have filed applications for allowances unemployment since mid-march, because of the containment measures. The economists expect the unemployment rate to approach or exceed the record figure of 25% of the active population, established during the Great Depression of 1929.

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