London RationalFX

RationalFX : Emergency FED rate cut

RationalFX : USD fell across the board on Tuesday, as the Federal Reserve announced a sudden interest rate cut in an attempt to protect the US economy from the economic fallout caused by the coronavirus………..

Sign up to our free newsletters


The Fed voted unanimously in lowering the interest rate by 50 basis points, with the first emergency cut since the financial crisis. According to the statement, despite the US economy remaining strong, the coronavirus outbreak poses evolving risks.

In a short speech following the announcement, Fed Chair, Jerome Powell, acknowledged that the outbreak would weigh on the economy for some time and that the risks to the US economic outlook had changed materially prompting the Fed to act.

Losses in USD were capped as markets had anticipated a cut this month following Powell’s comments on Friday.

Money markets are now pricing a 50% probability of an additional 25bp cut by the Fed this month and a UK interest rate cut of 25bp at 100%.

Key Announcements

USD – 15.00 – ISM Non-Manufacturing PMI (FEB) consensus 54.9 previous 55.5.

GBP – 18:00 – BOE Broadbent speech.

Source :

Related Articles

RationalFX: Sterling holds amid inflation data

Editorial Staff

RationalFX: Sterling pushes back against majors

Editorial Staff

RationalFX: Bank of England looking to raise interest rates

Editorial Staff