FED drops policy rate by 50 basis points to protect US economy against corona outbreak

The U.S. Central Bank (FED) has lowered its policy interest rate by 50 basis points to a range of 1% to 1.25% to protect the country’s economy from the impact of the corona virus outbreak. It was reported that the decision had been taken unanimously.

The US Central Bank (Fed) took an extraordinary decision to protect the US economy from the impact of the corona virus outbreak, lowering its policy interest rate by 50 basis points.

FED said in a statement “The fundamentals of the U.S. economy continue to be strong. However coronavirus presents variable risks on economic activity. The Federal Open Market Committee decided to lower the federal funding interest target range because of these risks and in line with the goal of maximum employment and price stability”.

Following the announcement, US stock markets moved their gains above 1%, while US Treasury bond yields declined. Gold rose in value as developing country stock markets rose hard.