CIO Daily Market Update with Will Bartleet
CIO and multi-asset portfolio manager at Pacific Asset Management
On Sunday afternoon, the US Federal Reserve cut interest rates by a full 1% to zero-to-25%bps and announced a new $700 billion asset purchase programme. This takes interest rates back to where they were during the financial crisis and for seven years after.
The Fed indicated that “the Committee expects to maintain this target range until it is confident that the economy has weathered recent events and is on track to achieve its maximum employment and price stability goals.”
In Europe, sweeping bans on travel were placed in an attempt to slow the spread of COVID-19. UK Prime Minister Boris Johnson urged British citizens to avoid “non-essential” travel and encouraged people to work from home where possible.
Markets sold off sharply with the US stock market reversing its gains from Friday’s session and there was weakness in some of riskier credit markets in particular. The Japanese Yen jumped again, particularly against Sterling, providing a partial offset to the Japanese stock market.
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