The US central bank, the Federal Reserve, is to introduce new rules to protect future home-buyers from dubious lending practices.
In his most sweeping response yet to the US housing and financial crisis, the head of the bank, Ben Bernanke, signalled that the market turmoil might continue longer than had been expected.
He said the new measures would concentrate on helping the financial system to return to normal and would apply to all lenders.
Wall Street recovered ground after the announcement last night, with the Dow Jones closing 1.36% higher and the Nasdaq up more than 2.25%.
Oil was the big driver after sharp falls in the price of oil eased fears that high oil prices would strangle spending.
The price of a barrel fell more than five dollars to $136.04 on comments from the G8 summit.
