Fed's Bullard: Rate cuts “a possibility” if coronavirus intensifies, but not the base case

Eren Sengezer FXStreet

The Federal Reserve could possibly opt out for rate cuts if the coronavirus outbreak intensifies and turns into a global pandemic, St. Louis Federal Reserve bank president James Bullard (non-voter) said on Friday but added it was not the base case scenario.

"The base case is that the Fed policy is in a good place, with insurance cuts from last year helping buffer against shocks," Bullard further explained. "The economic impacts of the outbreak will be noticeable in China but will be on a smaller scale elsewhere with temporary disruptions to global supply chains.

USD reaction

Following these comments, the US Dollar Index stays in the positive territory near the 98.50 mark.

Author

Eren Sengezer

FXStreet

As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.

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