U.S. Fed chair comments on emergency cut to interest rates
The U.S. Federal Reserve cut interest rates yesterday in a bid to shield the world’s largest economy from the impact of the coronavirus, but the emergency move failed to comfort U.S. financial markets roiled by worries about a deeper, lasting slowdown.
Fed Chair Jerome Powell reiterated his view that the U.S. economy remains strong, but said the spread of the virus had caused a material change in the U.S. central bank’s outlook for growth.
"The virus and the measures that are being taken to contain it will surely weigh on economic activity, both here and abroad, for some time," Powell said in a news conference shortly after policymakers unanimously decided to cut rates by a half percentage point to a target range of 1.00% to 1.25%.
"We’ve come to the view now that it is time to act in support of the economy. I do know that the U.S. economy is strong and we will get to the other side of this; I fully expect that we will return to solid growth and a solid labor market as well," Reuters cited him as saying.
Powell acknowledged the outlook is uncertain and the situation "fluid."