Federal Reserve Cuts Interest Rates in Response to Coronavirus
The Federal Reserve decided to cut interest rates today as “the coronavirus poses evolving risks to economic activity”. The Federal Open Market Committee as such will “lower the target range for the federal funds rate by 1/2 percentage point, to 1 to 1‑1/4 percent.”
Additionally, the Reserve will “continue purchasing Treasury bills”, “continue conducting term and overnight repurchase agreement operations”, and “conduct overnight reverse repurchase operations”; all tools of monetary policy the Federal Reserve uses to stabilize the economy.
The Committee says they are “closely monitoring [coronavirus] developments and their implications for the economic outlook and will use its tools and act as appropriate to support the economy.”