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In an emergency move, US Fed cuts interest rate to battle coronavirus
[WASHINGTON] The US Federal Reserve cut interest rate on Tuesday in an emergency move designed to shield the world's largest economy from the impact of the coronavirus.
In a statement, the central bank said it was cutting the rate by a half percentage point to a target range of 1.00 per cent to 1.25 per cent.
"The fundamentals of the US economy remain strong. However, the coronavirus poses evolving risks to economic activity. In light of these risks and in support of achieving its maximum employment and price stability goals, the Federal Open Market Committee decided today to lower the target range for the federal funds rate," the Fed said a statement.
The decision was unanimous among policymakers.
The Fed's decision to cut interest rate before its next scheduled policy meeting on March 17-18 reflects the urgency with which the Fed feels it needs to act in order to prevent the possibility of a global recession.
Wall Street stocks jumped Tuesday after the Fed action.
Around 1505 GMT, the Dow Jones Industrial Average was at 27,040.74, up 1.3 per cent.
The broad-based S&P 500 gained 1.4 per cent to 3,133.37, while the tech-rich Nasdaq Composite Index advanced 1.2 per cent to 9,063.33.