Mnuchin Rejects Renewal Of Fed Emergency Loan Programs Set To Expire During The Holidays

  • Treasury Secretary Steven Mnuchin said Thursday he will not extend several emergency loan programs set up with the Federal Reserve, an action that could hamper the ability of the incoming Biden administration to gain important economic support from the central bank, to deal with the ongoing pandemic.
  • The decision drew a terse rebuke from the Fed. The central bank said it “would prefer that the full suite of emergency facilities established during the coronavirus pandemic continue to serve their important role as a backstop for our still-strained and vulnerable economy.”
  • In a letter to Fed Chairman Jerome Powell, Mnuchin said that the Fed’s corporate credit, municipal lending and Main Street Lending programs would not be renewed when they expire on Dec. 31. Mnuchin’s move comes as the resurgent virus and slowing consumer spending, as well as colder weather that will shut down outdoor dining, will cause more small and mid-sized businesses to struggle with lower revenue and potentially close.

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