Fed Bolsters its Focus on Financial Stability The Federal Reserve has expanded its financial-policy office to include the Division of Financial Stability in an attempt to spot vulnerabilities in the U.S. financial system. “The change reflects the growth in responsibilities and staffing associated with the board’s commitment to identifying and analyzing risks to financial stability and to developing and evaluating macroprudential policy responses to those risks,” the central bank said in a statement. Lisa Lambert explains. To read the full article in Reuters, click: Fed Board Expands Financial Stability Wing.
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Fed Limits its Ability to Rescue Financial Firms The Federal Reserve has adopted restrictions on its ability to rescue failing financial companies. Howard Schneider reports in this article that under the rules, the Fed can provide only broad-based assistance and cannot rescue individual firms. To read the full article in Reuters, click: New Fed Rule Limits its Crisis Bailout Powers.