News & Events

U.S. current monetary policy appropriate despite COVID-19 threat: Fed official

发布时间:2020-03-02

While the COVID-19 outbreak poses a threat to the U.S. economic growth, the current stance of monetary policy likely will remain appropriate, U.S. Federal Reserve Vice Chair Richard Clarida said Tuesday.
 
"Risks to the (U.S. economic) outlook remain. In particular, we are closely monitoring the emergence of the coronavirus," Clarida said at the annual economic policy conference held by the National Association for Business Economics (NABE) in Washington.
 
"But it is still too soon to even speculate about either the size or the persistence of these effects, or whether they will lead to a material change in the outlook," he said.
 
Clarida believed that U.S. monetary policy is "in a good place" and should continue to support sustained growth, a strong labor market, and inflation returning to the central bank's target of 2 percent.
 
The Fed's policy-making committee will "proceed on a meeting-by-meeting basis" and will be monitoring the effects of its recent policy actions along with other information bearing on the outlook as the central bank assesses the appropriate path of interest rates, he said.
 
"Of course, if developments emerge that, in the future, trigger a material reassessment of our outlook, we will respond accordingly," said the Fed vice chair.
 
Clarida's remarks came after White House National Economic Council Director Larry Kudlow said earlier Tuesday that he didn't expect the Fed to cut interest rates in a "panic" move to protect markets from the impact the coronavirus could make on the global economy.
 
"I don't expect the Fed - I'm not hearing the Fed's going to make any panic move," Kudlow told CNBC. "Apart from the virus, I have said I wouldn't mind seeing my friends at the Fed be a little bolder in their target rate and their balance sheet."
 
The Fed lowered interest rates three times in 2019, cutting the target range of the federal funds rate by 75 basis points to 1.5 percent-1.75 percent. After wrapping up its first monetary policy meeting of 2020 in late January, the Fed left interest rates unchanged and maintained a wait-and-see stance.


(ASIA PACIFIC DAILY)