The US Congress will legislate in coming months to create regulatory powers to combat systemic risk, with authority almost certainly awarded to the Federal Res­erve, a leading member of the House of Representatives has told the Financial Times.

Barney Frank, the powerful chairman of the House financial services committee, said that “by the spring I believe we will have passed a bill which empowers a systemic risk regulator”. He added it had “almost certainly got to be the Fed”.