The Federal Reserve has made its second rate cut this month in an effort to pump up the economy during what the central banking system calls a “challenging period.” The Federal Reserves statement reads, in part:
The effects of the coronavirus will weigh on economic activity in the near term and pose risks to the economic outlook. In light of these developments, the Committee decided to lower the target range for the federal funds rate to 0 to 1/4 percent. The Committee expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals. This action will help support economic activity, strong labor market conditions, and inflation returning to the Committee’s symmetric 2 percent objective.
The benchmark U.S. interest rate will now be in a range of 0 to 0.25 percent.
— The Washington Post (@washingtonpost) March 15, 2020
The Fed also announced at least $700 billion worth of bond purchases and took a variety of actions to enable banks to continue lending during the health crisis. https://t.co/mVwXIcfeyI
Donald Trump reacted to the news during a White House press briefing Sunday afternoon.
Despite the cut, Dow futures for Monday tanked, down nearly 900 points.
