The Federal Reserve Board has released a Federal Open Market Committee Statement following an extraordinary Sunday meeting, to announce the Committee's decision to lower the target range for the federal funds rate to 0 to 1/4 percent. The Committee "expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals. This action will help support economic activity, strong labor market conditions, and inflation returning to the Committee's symmetric 2 percent objective."
The announcement also said that to "support the smooth functioning of markets for Treasury securities and agency mortgage-backed securities that are central to the flow of credit to households and businesses, over coming months the Committee will increase its holdings of Treasury securities by at least $500 billion and its holdings of agency mortgage-backed securities by at least $200 billion. The Committee will also reinvest all principal payments from the Federal Reserve's holdings of agency debt and agency mortgage-backed securities in agency mortgage-backed securities. In addition, the Open Market Desk has recently expanded its overnight and term repurchase agreement operations. The Committee will continue to closely monitor market conditions and is prepared to adjust its plans as appropriate."
The implementation note issued with the Fed's announcement reports the the Board of Governors voted unanimously to set the interest rate paid on required and excess reserves at 0.10 percent effective March 16, and to approve a 1-1/2 percentage point decease in the primary credit rate at Federal Reserve Banks to 0.25 percent, also effective March 16. Banks will be able to borrow from the Fed's discount window for periods up to 90 days.
In addition, in a press release concerning the Federal Reserve's actions to support the flow of credit to households and businesses, the Board of Governors announced that, beginning with next reserve maintenance period on March 26, reserve requirements will be eliminated for thousands of depository institutions to help support lending to households and businesses.
UPDATE: The Board published amendments to Regulation A [85 FR 16526] and Regulation D [85 FR 16526—Interest on reserves] and [a href="https://www.federalregister.gov/d/2020-05806">85 FR 16525—lowering reserve ratios on transaction accounts] on March 24, 2020.