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For release at 2 p.m. EDT

June 10, 2020

The Federal Reserve is committed to using its full range of tools to support the
U.S. economy in this challenging time, thereby promoting its maximum employment and
price stability goals.
The coronavirus outbreak is causing tremendous human and economic hardship
across the United States and around the world. The virus and the measures taken to
protect public health have induced sharp declines in economic activity and a surge in job
losses. Weaker demand and significantly lower oil prices are holding down consumer
price inflation. Financial conditions have improved, in part reflecting policy measures to
support the economy and the flow of credit to U.S. households and businesses.
The ongoing public health crisis will weigh heavily on economic activity,
employment, and inflation in the near term, and poses considerable risks to the economic
outlook over the medium term. In light of these developments, the Committee decided to
maintain the target range for the federal funds rate at 0 to 1/4 percent. The Committee
expects to maintain this target range until it is confident that the economy has weathered
recent events and is on track to achieve its maximum employment and price stability
goals.
The Committee will continue to monitor the implications of incoming information
for the economic outlook, including information related to public health, as well as global
developments and muted inflation pressures, and will use its tools and act as appropriate
to support the economy. In determining the timing and size of future adjustments to the
stance of monetary policy, the Committee will assess realized and expected economic
conditions relative to its maximum employment objective and its symmetric 2 percent
inflation objective. This assessment will take into account a wide range of information,
including measures of labor market conditions, indicators of inflation pressures and
inflation expectations, and readings on financial and international developments.
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For release at 2 p.m. EDT

June 10, 2020
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To support the flow of credit to households and businesses, over coming months
the Federal Reserve will increase its holdings of Treasury securities and agency
residential and commercial mortgage-backed securities at least at the current pace to
sustain smooth market functioning, thereby fostering effective transmission of monetary
policy to broader financial conditions. In addition, the Open Market Desk will continue
to offer large-scale overnight and term repurchase agreement operations. The Committee
will closely monitor developments and is prepared to adjust its plans as appropriate.
Voting for the monetary policy action were Jerome H. Powell, Chair; John C.
Williams, Vice Chair; Michelle W. Bowman; Lael Brainard; Richard H. Clarida; Patrick
Harker; Robert S. Kaplan; Neel Kashkari; Loretta J. Mester; and Randal K. Quarles.
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For release at 2 p.m. EDT

June 10, 2020

Decisions Regarding Monetary Policy Implementation
The Federal Reserve has made the following decisions to implement the monetary policy
stance announced by the Federal Open Market Committee in its statement on June 10,
2020:
•

The Board of Governors of the Federal Reserve System voted unanimously to
maintain the interest rate paid on required and excess reserve balances at
0.10 percent, effective June 11, 2020.

•

As part of its policy decision, the Federal Open Market Committee voted to
authorize and direct the Open Market Desk at the Federal Reserve Bank of New
York, until instructed otherwise, to execute transactions in the System Open Market
Account in accordance with the following domestic policy directive:
“Effective June 11, 2020, the Federal Open Market Committee directs the Desk
to:
o Undertake open market operations as necessary to maintain the federal
funds rate in a target range of 0 to 1/4 percent.
o Increase the System Open Market Account holdings of Treasury
securities, agency mortgage-backed securities (MBS), and agency
commercial mortgage-backed securities (CMBS) at least at the current
pace to sustain smooth functioning of markets for these securities, thereby
fostering effective transmission of monetary policy to broader financial
conditions.
o Conduct term and overnight repurchase agreement operations to support
effective policy implementation and the smooth functioning of short-term
U.S. dollar funding markets.
o Conduct overnight reverse repurchase agreement operations at an offering
rate of 0.00 percent and with a per-counterparty limit of $30 billion per
day; the per-counterparty limit can be temporarily increased at the
discretion of the Chair.
o Roll over at auction all principal payments from the Federal Reserve's
holdings of Treasury securities and reinvest all principal payments from
the Federal Reserve's holdings of agency debt and agency MBS in agency
MBS and all principal payments from holdings of agency CMBS in
agency CMBS.
o Allow modest deviations from stated amounts for purchases and
reinvestments, if needed for operational reasons.
o Engage in dollar roll and coupon swap transactions as necessary to
facilitate settlement of the Federal Reserve's agency MBS transactions.”

•

In a related action, the Board of Governors of the Federal Reserve System voted
unanimously to approve the establishment of the primary credit rate at the existing
level of 0.25 percent.

For release at 2 p.m. EDT

June 10, 2020
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This information will be updated as appropriate to reflect decisions of the Federal Open
Market Committee or the Board of Governors regarding details of the Federal Reserve’s
operational tools and approach used to implement monetary policy.
More information regarding open market operations and reinvestments may be found on
the Federal Reserve Bank of New York’s website.
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Federal Reserve Bank of St. Louis, One Federal Reserve Bank Plaza, St. Louis, MO 63102