Fed saved US from even larger pandemic downturn – ECB paper

Federal Reserve headquarters in Washington DC

The combined actions of the Federal Reserve and the US Treasury prevented Covid-19 from triggering a major recession, a working paper published by the European Central Bank finds.

In Monetary and fiscal complementarity in the Covid-19 pandemic, Jagjit Chadha et al analyse the actions of the Fed and the US government in 2020. The Fed purchased “extraordinary quantities of securities” while the US government ran a deficit of 17% of projected GDP, the authors say.

Their model finds that the Fed’s

Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.

To access these options, along with all other subscription benefits, please contact [email protected] or view our subscription options here: http://subscriptions.centralbanking.com/subscribe

You are currently unable to copy this content. Please contact [email protected] to find out more.

To continue reading...

You need to sign in to use this feature. If you don’t have a Central Banking account, please register for a trial.

Sign in
You are currently on corporate access.

To use this feature you will need an individual account. If you have one already please sign in.

Sign in.

Alternatively you can request an individual account here: