The U.S. Federal Reserve has said that it would buy as many Treasury and mortgage-backed securities as needed to support the coronavirus-hit financial markets.
“Aggressive efforts must be taken across the public and private sectors to limit the losses to jobs and incomes and to promote a swift recovery once the disruptions abate,” said the central bank in a Monday morning statement.
The Fed previously announced it would purchase at least $500 billion of Treasury securities and at least $200 billion of mortgage-backed securities.
Both crypto and traditional financial markets appear to have reacted positively to the news. Bitcoin is currently trading at around $6,300, up around 5% in the past 24 hours. S&P 500 Futures, on the other hand, are up by about 2% at 2,355 in intraday.
The Fed will support “the flow of credit to employers, consumers and businesses by establishing new programs that, taken together, will provide up to $300 billion in new financing.” It will be backed by $30 billion from the Treasury’s Exchange Stabilization Fund.
The Fed also said it “expects to announce soon the establishment of a Main Street Business Lending Program to support lending to eligible small and medium-sized businesses, complementing efforts” by the Small Business Administration.