The Fed Transformed: Jay Powell Leads Central Bank into Uncharted waters

WASHINGTON—To meet the dislocation the coronavirus pandemic unleashed on the economy, Federal Reserve Chairman Jerome Powell has mobilized the central bank to move faster and farther than ever before.

In the short weeks since financial markets seized up, Mr. Powell has placed the Fed on wartime footing. He took up the central bank’s playbook from the 2008 financial crisis and then some—cutting rates to near zero, purchasing huge quantities of government debt and, breaking a taboo, lending to American businesses.

The pace left no time for the deliberative policy process the Fed prefers. Officials can spend weeks tweaking a few words in a heavily parsed statement. This time, the team saw the need for immediate action.

When Fed officials met Sunday morning, March 15, infections were rising along the East Coast. Mr. Powell and his colleagues left empty seats in between them at the central bank’s oval boardroom table, made of Honduran mahogany and granite. Two screens suspended from the two-story boardroom ceiling showed 12 reserve bank presidents and others who dialed in remotely. They made decisions in four hours that would usually take two days.

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