New York City is Now Epicenter of Coronavirus COVID-19 Outbreak in the USA

The Federal Reserve Cut Interest Rates to Nearly Zero, Following Widespread Coronavirus COVID-19 Infections!

By Glenford Robinson

On Sunday, March 15, 2020 at 5PM, Eastern Standard Time, exactly 12 days after the Federal Reserve cut interest rates by 50 basis points from 1.75% to 1.25% in anticipation of the coronavirus hitting the U.S., the Federal Reserve again cut interest rate, but this time by 100 basis points from 1.25% to a range of 0-0.25%, now that the coronavirus hits the U.S., causing the closing of schools, the cancellation of professional sports league games, the infection of mega famous celebrities such as actor, Tom Hanks and his wife Rita Wilson, Sophie Gregoire Trudeau, the wife of Canadian Prime Minister Justin Trudeau, and Arsenal coach Mikel Arteta plus many more famous sports stars, including NBA Utah Jaz stars Donavan Mitchell and Rudy Gobert. Public figures such as British Member of Parliament Nadine Dorries, a minister in the health department who helped craft legislation to fight COVID-19 is also infected.

The Federal Reserve called off its March policy meeting, scheduled for Tuesday and Wednesday, March 17-18 as a result of Sunday’s emergency policy statement. This most likely means that the next Federal Reserve policy meeting may not be held until June for the next summary of economic projections. A very financially troubling statement made by the Fed chairman, Jerome Powel was that of the second quarter growth projection, saying that 2nd quarter growth will most likely be weaker.

At the open, on Thursday, Wall Street sank so fast that trading halted for 15 minutes, as the S&P 500 dropped 7% in a flash crash, while the Dow Jones fell even deeper into bear market territory, as coronavirus infection spread worldwide and investors doubting that the announced stimulus measures will be enough to stave off an economic recession.  US President Trump suspended all travel from Europe for the next 30 days starting Friday.

It seems like the Global Economy is one pandemic away from total collapse. This means that it doesn’t matter how strong the economy is, a viral breakout at pandemic proportion could easily wipeout all economic gains. The U.S. economy has been on a steady rise from 2008, starting right after the last economic crash, but as we can see from the recent stock market pullbacks, things can change very quickly, no matter how strong the economy has become. In fact, even though the U.S. economy has been on the rise for the past 12 years, this rise happened to be the slowest in history. This caused many in the financial industry to think that the Federal Reserve was the main reason why the economy hasn’t collapse already because the Fed would jump into action and add liquidity to the financial system if the economy begins to show signs of slowing down. Therefore, todays 100-basis point interest rate cut, by the Federal Reserve should not be a surprise.

The Federal Reserve Cut Interest Rates to Nearly Zero, Following Widespread Coronavirus COVID-19 Infections!

Disclosure

The Mstardom Finance trading team currently trades the EUR/USD currency pair, utilizing long, short, and hedging strategies. 

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