Fed lending rate remains close to zero to boost COVID-19 recovery

Nov. 5 (UPI) -- The Federal Reserve again left its benchmark lending rate unchanged and close to zero on Thursday, saying the committee wanted to support the U.S. economy during challenging times amid a public health crisis.

"The COVID-19 pandemic is causing tremendous human and economic hardship across the United States and around the world," the Federal Open Market Committee said in a statement. The committee said the Fed would keep policy measures in place "to support the economy and the flow of credit to U.S. households and businesses."

The target range for the lending rate would remain between zero and 0.25%. Monetary policy would be built around achieving "maximum employment and inflation at the rate of 2% over the longer run," the committee said Thursday. Factors like public health, labor market conditions, inflation pressures, inflation expectations, and financial and international developments will be monitored to develop the Fed's policy decisions, the committee added.

In a related action, the Fed's board of governors voted to keep the primary credit rate at the existing level of 0.25%.

"Is monetary policy out of power or out of ammunition? The answer to that is no, I don't think that," Chairman Jerome Powell said during a news conference.

"I think that we're strongly committed to using these powerful tools that we have to support the economy during this difficult time for as long as needed and no one should have any doubt about that," Powell added.

In June, the Fed said it doesn't expect to raise the federal funds rate until at least 2022.

The U.S. economy expanded by 33% in the period between July and October, the Commerce Department reported last week, bouncing back from a 31% drop between April and July.

The final jobs report before the election showed an addition of about 660,000 payroll jobs during the month of September.