The US Federal Reserve’s balance sheet rose up to more than $5 trillion in assets after taking up bonds and extended loans to banks, central banks, and mutual funds in its emergency measure to support the economy amid the coronavirus pandemic.
The Fed’s balance sheet size reached up to half a trillion dollars in a week, almost twice the size of the weekly expansion during the 2008 financial crisis. The Fed’s total stash of assets was at $5.3 trillion on Wednesday.
The Fed purchased $355 billion of Treasuries and mortgage bonds last week in an attempt to stabilize financial markets and economic activity.
Banks lined up to file loans from the Fed. As of Wednesday, borrowings reached $50.8 billion, from the $28.2 billion last week.
Fed Chairman Jerome Powell said that the Fed is more than willing to lend to banks in order to counter the economic impact of the virus.
Meanwhile, claims for unemployment benefits climbed up to a record 3.3 million last week in the U.S. Millions of Americans are in self-isolation and businesses across the country have stopped operations as a measure to contain the virus.