More central banks likely to follow Fed into easing, but effect could be muted

Singapore

THE US Federal Reserve caught many by surprise with an emergency rate cut to stem effects of the Covid-19 outbreak, and strategists believe other central banks will follow suit, though the effects could be limited.

On Tuesday, the US central bank made a 50 basis points (bps) cut to the Fed Funds rate - its largest since the global financial crisis in 2008 - to the range of 1-1.25 per cent.