The worst-case scenario of the staff of the Federal Reserve for the economy is no recovery until next year, according to minutes of the central bank's March 15 policy meeting released Wednesday. The staff told officials that there were two plausible scenarios for the U.S. economy grappling with the coronavirus. In one scenario, the U.S. economy would start to recover in the second half of the year. The more adverse scenario was that the economy entered a recession with no significant rebound until next year. Facing this uncertainty, Fed officials responded by slashing interest rates to...
The Bank of England has announced a surprise 50 basis point rate cut from 0.75% to 0.25%. Both outgoing Governor Mark Carney and his successor Andrew Bailey had previously said that they are ready to act in face of the coronavirus crisis. While the move is not a total surprise, but the timing “ outside a scheduled meeting “ is responsible for the sharp move in sterling. Moreover, the BOE's new rate of 0.25% puts its at the post-Brexit low, exhausting the "Old Lady's" firepower. The BOE also announces a new SME worth £100 billion “ a lending scheme to businesses. The Monetary Policy...
The Federal Reserve, in a rare inter-meeting move, on Tuesday cut its benchmark interest rate to counter the threat to the economy from the coronavirus epidemic. In a statement, the Fed said it cut its fed funds target rate by a half percentage point to a range of 1%-1.25%. œThe fundamentals of the U.S. economy remain strong. However, the coronavirus poses evolving risks to economic activity, the statement said. At a press conference later, Fed Chairman Jerome Powell said officials saw the virus spreading and this represented a material change in the outlook for economic...
The U.S. Federal Reserve delivered an emergency half-percentage point interest rate cut Tuesday in a bid to protect the longest-ever economic expansion from the spreading coronavirus. œThe coronavirus poses evolving risks to economic activity, the Fed said in a statement. œIn light of these risks and in support of achieving its maximum employment and price stability goals, the Federal Open Market Committee decided today to lower the target range for the federal funds rate by 1/2 percentage point. The central bank also said it is œclosely monitoring developments and their...
At its March monetary policy meeting on Tuesday, the Reserve Bank of Australia (RBA) cut its official cash rate (OCR) by 25bps to a record low of 0.50%, as they weighed in the coronavirus outbreak risks. According to the latest Reuters poll, a majority of the 35 economists polled expected the central bank to maintain the status quo. RBA Interest Rate Decision is announced by the Reserve Bank of Australia. If the RBA is hawkish about the inflationary outlook of the economy and rises the interest rates it is positive, or bullish, for the AUD. Likewise, if the RBA has a dovish view on the...
Federal Reserve officials and the central banks staff said the U.S. economy seemed stronger in late January than they had expected, according to minutes of their late-January meeting released Wednesday. The risks to the outlook were more favorable than had appeared at their meeting in mid-December. There were concerns expressed during their discussions about the threat of the coronavirus outbreak in China, and also of tensions in the Middle East. The Fed staffs projection for U.S. GDP growth was stronger at the January meeting than in the previous forecast. The staff also said that...
Bank of England Governor Mark Carney said on Monday that the possibility of Britain leaving the European Union next month without a transition deal ranked as the riskiest Brexit scenario for the...
At its March monetary policy meeting on Tuesday, the Reserve Bank of Australia (RBA) cut its official cash rate (OCR) by 25bps to a record low of 0.50%, as they weighed in the coronavirus outbreak...