Regulation

Federal Reserve to launch commercial paper funding facility amid virus panic

‘This facility should encourage investors to once again engage in term lending in the commercial-paper market.’

The Federal Reserve said Tuesday it would establish a lending facility to support short-term commercial debt markets to prevent intensifying funding strains from accelerating economic damage from the coronavirus.

The Fed said it had established the new Commercial Paper Funding Facility, a version of which was last used during the 2008 financial crisis, after securing the approval of the Treasury secretary.

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