WASHINGTON (Reuters) - The U.S. Federal Reserve Board voted Wednesday to keep its Countercyclical Capital Buffer at zero percent, saying it would not order banks to hold additional capital to protect against a future economic downturn.
The Fed said it made the decision after consulting with other bank regulators. The tool is intended to direct banks to hold more capital during times when the economy is strong to bolster resilience in future recessions.
Governor Lael Brainard, who had previously advocated for raising the buffer, dissented from Wednesday’s decision.
Reporting by Pete Schroeder; Editing by Leslie Adler