Tags: US | Fed | Exit | Strategy

Fed Adopts Plan to Let Banks Set Up CDs to Drain Liquidity

Friday, 30 Apr 2010 12:40 PM

 

Share:
  Comment  |
   Contact Us  |
  Print  
|  A   A  
  Copy Shortlink

The Federal Reserve has adopted a plan allowing banks to set up the equivalent of certificates of deposit at the central bank.

The move would help the Fed mop up money pumped out during the financial crisis and prevent inflation from taking off later.

Under the plan, the Fed would offer so-called "term deposits" that would pay interest. Doing so would provide banks with another incentive to park their money at the Fed, rather than having it flow back into the economy.

Once the economy is on firm footing, this would be one of the tools the Fed could use to tighten credit.

The Fed says Friday's action has "no implication for the near term conduct of monetary policy."

© Copyright 2014 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Share:
  Comment  |
   Contact Us  |
  Print  
  Copy Shortlink
Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Country
Zip Code:
Privacy: We never share your email.
 
Hot Topics
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
Top Stories
You May Also Like

Bill Clinton: World's Borders More 'Like Nets Than Walls'

Friday, 19 Sep 2014 06:14 AM

Power is more diffuse in a technologically advanced world, and that means inclusiveness is the only way to battle the wo . . .

Report: Washington Full of Cell Phone Spying Devices

Thursday, 18 Sep 2014 22:12 PM

The Washington, D.C., area is littered with devices that spy on users' cellphones, and one expert thinks they were plant . . .

Man Kills Daughter, Six Grandchildren in Murder-Suicide

Thursday, 18 Sep 2014 21:43 PM

A 51-year-old Florida man shot dead his daughter and six grandchildren in his home before killing himself on Thursday, a . . .

Most Commented

Newsmax, Moneynews, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, NewsmaxWorld, NewsmaxHealth, are trademarks of Newsmax Media, Inc.

 
NEWSMAX.COM
America's News Page
©  Newsmax Media, Inc.
All Rights Reserved