Today’s FOMC statement did not add much to what had previously been announced. Following a string of bold, rapid moves and new initiatives starting last month to address the coronavirus pandemic, Chair Powell signals no change of course for the time being
- Fed funds target rate unchanged at 0 to 25 bps, IOER unchanged at 10 bps
- Explicit statement that the pandemic is a demand shock, thus deflationary
- Expects risks from pandemic to last well into the “medium term”, clearly not optimistic about the future
The ongoing public health crisis will weigh heavily on economic activity, employment, and inflation in the near term, and poses considerable risks to the economic outlook over the medium term.”
FOMC statement 29-Apr-2020
