Fed Watch: Powell signals easing is coming – new Fed forecast

From e-markets.nordea.com

In a piece on Thursday, we asked ourselves how close the Fed was to a policy response on the back of the corona markets sell-off. We argued that if equities tanked 5%-point more, we would reach the same levels of financial conditions indices as when the Fed cut rates three consecutive times during H2 2019. That scenario has since unfolded (see chart 1). We therefore expect an easing package in March. The equity sell-off has also prompted a response from Chair Powell who in a statement late Friday night said that “the coronavirus poses evolving risks to economic activity. The Federal Reserve is closely monitoring ... (full story)