Overseas Headlines- March 09, 2020

March 09, 2020

United States:

Fed Faces Fresh Pressure to Act, Boosts Repo Operations

“The Federal Reserve lifted the amount of temporary cash it’s willing to provide markets as pressure intensifies for the U.S. central bank to tackle the risk of a worldwide credit crunch. The Federal Reserve Bank of New York will increase the size of this week’s overnight and term repurchase operations, according to a statement released Monday. That added boost of liquidity comes just less than a week since the policy makers executed an emergency interest-rate cut amid plunging stocks and bond yields and growing fears over the spreading coronavirus.”



Rate Cuts Aren’t Right Response to Virus, Says Ex-BOE Chief King

“Interest rate cuts and a broad fiscal spending aren’t an effective way to tackle the economic fallout from the coronavirus, according to former Bank of England Governor Mervyn King. U.K. finance minister Rishi Sunak should instead focus on short-term measures in this week’s budget, such as cash flow support for virus-hit businesses, King said in an interview with BBC Radio 4 on Monday.”



Japan’s Economic Slide, Yen Gains Fuel Virus Slump Fears

“Japan’s biggest contraction in more than five years and a sharp rise in the yen added to escalating concerns among policy makers about the ability of the world’s third-largest economy to fight off the impact of the coronavirus and a crash in oil prices. During a day in which markets were battered by a steady stream of bad news, senior government officials emphasized the need for continued coordination with other nations to address a shared global problem. Currency officials also warned against excessive foreign exchange moves after the yen jumped to its highest level in more than three years.”


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