The Federal Reserve's efforts to support the markets and economy through the coronavirus crisis are beyond anything it has done before, New York Fed President John Williams said Thursday.
Over the past month, the Fed has cut its benchmark interest rate to near zero and has instituted a barrage of programs aimed at keeping markets running smoothly and helping get money to businesses and individuals that have been hamstrung by an economic shutdown.
Williams said the Fed now has to make sure those moves perform as they are intended.
"Our work is not done," he said during an afternoon webinar with the Economic Club of New York.
Efforts to contain the coronavirus have shut down large parts of the U.S. economy. More than 22 million Americans have filed claims for unemployment benefits over the past four weeks.
"The reality is that the full scale of the economic consequences is still unknown," Williams said. "To put the current situation in context, we are running more open market operations, for greater sums, than at any time in our history."
He declined to give a specific forecast for how strong a recovery he sees, saying that the economy is "going to be underperforming for some time."
"There's certainly parts of the economy that as people go back to work, I see the economy bouncing back," he said.
"There's a lot of uncertainty about how long it will take," Williams added, noting that the Fed will "use all of our tools as appropriate" to support growth.
Much will depend on public psychology and how quickly people are willing to go out and attend events again, he added.
Williams stressed that the Fed's monetary moves have to work in conjunction with fiscal pending help from Congress. The Fed and Treasury Department have worked together on programs that could generate $6 trillion in loans and other funding to help the economy.
"The economy is under distress in ways we've not experienced in our lifetimes," he said. "At the New York Fed we are working tirelessly ... to address the economic and financial challenges posed by the pandemic."
The Fed's credit facilities have targeted the banking system, businesses of all sizes and state and municipal government debt. The most recent leg, announced a week ago, was targeted at injecting more than $2 trillion of loans.