In a press conference after the surprised -50bps rate cut, Fed Chair Jerome Powell said the “magnitude and persistence” of the overall effect of coronavirus outbreak on the US economy “remain highly uncertain”. FOMC judged that “risks to the U.S. outlook have changed materially”. Hence, “in response, we have eased the stance of monetary policy to provide some more support to the economy.”
Meanwhile, Powell provided no hints on what’s next for Fed. He just noted that the current action will provide a meaningful boost to the economy. When asked about reversing the rate cut, he said that if Fed get for a place where it’s appropriate to change, they will do it.
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