WASHINGTON (AP) — The Federal Reserve said Friday that parts of the U.S. financial system came under severe strain in March as a global pandemic was shutting down much of the economy.

It said quick action by the central bank helped alleviate many of the stresses but cautioned that further shocks to the financial system could occur depending on the course of the virus and the amount of damage it does to the U.S. economy.

The Fed's assessment of the virus' impact on the financial system came in a twice-a-year "Financial Stability Report" that the central bank issues to assess vulnerabilities in the financial system.

The report said that asset prices such as stocks and bonds have been volatile and could show further declines depending on the course of the virus.

"Asset prices remain vulnerable to significant price declines should the pandemic take an unexpected course, the economic fallout prove more adverse or financial system strains emerge," the Fed said.