The Fed now says it will purchase securities "in the amounts needed", and will also expand the scope of those purchases to include agency commercial mortgage-backed securities.
In addition, the Fed said it would soon unveil a program to lend directly to small- and medium-sized companies - those that have been hardest hit by the near complete shutdown of the United States economy as authorities fight to contain the spread of the virus.
In an announcement the Fed mentioned the trouble, authorized unanimously by members of the Federal Open Market Committee, was taken as a result of "it has develop into clear that our economy will face extreme disruptions" because of the well being disaster.
The latest move is seen as an attempt by the Fed to prevent the type of financial shock seen in the global financial crisis of 2008.
To support businesses, consumers, and employers, the Fed will provide up to $300 billion in new financing, including $30 billion from the Department of the Treasury, using the Exchange Stabilization Fund.
"I think the one thing we really need to see is more fiscal ammunition coming to the fore", said senior currency strategist Mazen Issa at TD Securities in NY.
"The downturn is not avoidable".
"That is the Fed's all-out effort to make sure that the enterprise sector and households can proceed on", mentioned Sam Bullard, senior economist for Wells Fargo Securities. "The Fed is now effectively the direct lender of last resort to the real economy, not just the financial system".
The Fed had already cut its key interest rate to almost zero. It will now directly buy new debt from large U.S. firms and revive a programme from the global financial crisis to support debt in the student and vehicle loan sectors.
The Fed also "expects to announce soon the establishment of a Main Street Business Lending Program to support lending to eligible small-and-medium sized businesses, complementing efforts" by the Small Business Administration.
The coronavirus outbreak has affected many aspects of business, especially civilian transport, the hospitality and restaurant industry as Americans are being urged to stay home and prevent the spread of the infection.
Investors are now waiting on the U.S. government to pass stimulus to support the economy.