Central bank talk dominates the headlines to start the week
- RBNZ cuts key interest rate to 0.25% from 1.0% in emergency decision
- RBNZ's Ha says QE program to be ready for month of May, if needed
- Federal Reserve acts on a Sunday evening to slash rates to near zero
- Fed's Powell says there will be no FOMC meeting this week - action today instead
- Fed's Powell says he does not think negative rates in the US are appropriate
- BOE Carney and Bailey comment on the coordinated global central bank cuts
- RBA says it is ready to purchase Australian government bonds
- BOJ maintains policy rate, increases pace of ETF purchases
- BOJ: May increase or cut ETF goal depending on situation
- Bank of Korea cuts key interest rate by 50 bps to 0.75%
With the latest decisions above, it means that the supposedly scheduled Fed and BOJ policy meetings later this week will not be taking place - since both central banks have chosen to act already today.
Despite action by global central banks to try and counteract the economic fallout from the virus outbreak, equities are being battered today with European indices down by 7-8% across the board and US futures also hitting limit down earlier in the day.
The Fed's action may be drastic but it has been priced in by the market for a while now.
Also, the emergency maneuver isn't really exuding much confidence as it could be a signal that the liquidity and financial strains in the market right now is possibly more severe than what many would anticipate them to be.
