Stability of Financial Institutions During and Beyond COVID-19
As part of its announcement on interest rate policy, the Federal Reserve of New York stated that “sustainably achieving maximum employment and price stability depends on a stable financial system. The new interest rate policy framework will, at least in part, determine how the United States will recover from the COVID-19 economic fallout”.
Globally, financial institutions are grappling with dynamic stock market fluctuations caused by the pandemic, and it remains to be seen what the long-term impact on the stability of the United States’ financial system will be. What we do know is that the preparedness of US financial institutions to serve consumers in an era of high unemployment and low wages, and the impact of government economic assistance, both indirect and direct, on consumers, will be the key indicators.
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