Sept. 28 (Bloomberg) -- Congress's $700 billion legislative...

Sept. 28 (Bloomberg) -- Congress's $700 billion legislative compromise to revive credit markets would also expand the Federal Reserve's power to manage short-term interest rates
That would encourage banks to deposit excess funds with the Fed rather than dumping them into the money markets and distorting its overnight federal funds rate
Paying interest on reserves puts a ``floor'' under the traded overnight rate, which would allow a central bank ``to provide liquidity during times of stress'' without affecting the rate, New York Fed economists said