FILE - In this March 3, 2020 file photo, Federal Reserve Chair Jerome Powell pauses during a news conference in Washington.
FILE - In this March 3, 2020 file photo, Federal Reserve Chair Jerome Powell pauses during a news conference in Washington.

WASHINGTON - The U.S. central bank, the Federal Reserve, announced aggressive new actions early Monday to try to bolster the world’s largest economy against the jolting effects of the coronavirus. 

The Fed said it would buy an unlimited amount of government-backed debt and mortgage-backed securities to support credit markets. The central bank also unveiled a series of lending programs to assist both large and small businesses, even as many U.S. companies lay off thousands of workers in the face of declining demand for their products and services.

The unusual timing of the Fed announcement came just ahead of the open of a new week of trading on the roiling U.S. markets, where stocks have sustained huge losses this month as the deadly pandemic spreads across the globe and deepens concerns across the United States.

U.S. stock futures had been trading down 2% or more Sunday night and into Monday. Initially, the Fed announcement had no effect on that trend, with the widely watched Dow Jones Industrial Average of 30 blue chip American companies dropping nearly 3% at the open of trading.

 “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,” the central bank said.

“The Federal Reserve is using its full range of authorities to provide powerful support for the flow of credit to American families and businesses,” the central bank statement said.

The Fed said it would buy U.S. government bonds and the mortgage-backed securities “in the amounts needed to support smooth market functioning.”

That appeared to indicate the central bank is willing to take an even more aggressive role than its recent cut in its benchmark lending rate to near zero percent and the $700 billion in new bond purchases it announced last week.

The Fed said it is establishing a new “’Main Street Business Lending Program’ to support lending to eligible small businesses.”

In their statement, Fed leaders said the bank “is committed to using its full range of tools to support households, businesses, and the U.S. economy overall in this challenging time."

“Our nation’s first priority is to care for those afflicted and to limit the further spread of the virus,” it added. “While great uncertainty remains, it has become clear that our economy will face severe disruptions. 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.”

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