Fed pressed from all sides to counter coronavirus damage
By Sylvan Lane
The Federal Reserve is under pressure from Wall Street to cut interest rates as the financial sector braces for the unknown economic toll of the coronavirus and after markets suffered a weeklong free fall. Federal Reserve Chairman Jerome Powell said in a Friday statement that the central bank “will use our tools and act as appropriate” to protect the economy, evoking the Fed’s 2019 pledge to cut interest rates across three consecutive meetings. …“Saving the market won’t save the world,” wrote Karen Shaw Petrou, managing partner at Federal Financial Analytics, in a Friday research note. Such a move “only reinforces the Fed’s role as the equity market’s savior, driving the Fed still deeper into an ultra-low rate hole from which it can’t extricate itself no matter the long-term damage to growth and economic equality,” she continued.