WASHINGTON: The US Federal Reserve said Monday it has extended several pandemic emergency lending programs for three months through March 31, with approval from the Treasury Department.
The announcement came after Treasury Secretary Steven Mnuchin last week said some of the programs should be allowed to lapse as planned on December 31 - but he did approve an extension of some aimed at supporting financial markets. The Fed protested the decision in a rare public statement, saying the programs provided an important "backstop for our still-strained and vulnerable economy."
Mnuchin's decision to pull back $455 billion in unused funds from the Fed, even as Covid-19 cases are spiking, drew intense criticism and accusations he was trying to sabotage President-elect Joe Biden's efforts to support the economy.
In the announcement, the central bank said that by supporting "critical short-term funding markets, these facilities are supporting market functioning and enhancing the flow of credit to the economy."
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