Weekly Economic and Financial Commentary – 14 April, 2020
The U.S Federal Reserve last week announced a raft of measures to assist households, businesses, state and local governments in response to the economic fallout of the COVID-19 outbreak. The Fed estimates that the programs will provide an additional $2.3 trillion worth of financial support. The most important new measure is the Main Street Lending Program, which is expected to make four-year loans to businesses that have up to 10,000 employees or revenues of less than $2.5 billion.
The Fed will also bolster the effectiveness of the Small Business Administration’s Paycheck Protection Program (PPP) and help state and local governments manage cash flow stresses by establishing a Municipal Liquidity Facility that will offer up to $500 billion in lending.
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