The US FED has brought down the bank rate to near zero level and has also assured the banks that the rates will remain at these levels for some more time to come. The US FED is also planning to directly buy long dated illiquid securities from the banks and other lenders over the coming months, with a view to improve their finances.

The provisioning norms for illiquid securities have also been relaxed with a view to give more leeway to the banks which are already sinking due to huge write offs in the last one year.

The housing rates are continuing to sink in US with nearly 15% decline recorded in the first two months of 2009, over the rates a year ago.

The US FED has also taken the decision to print new currency to fund the purchase of illiquid securities from banks and lending institutions.