Market comment | Fed made inter-meeting 50bps interest cut
Published on Tuesday, March 3, 2020 | Updated on Tuesday, March 3, 2020
Market comment | Fed made inter-meeting 50bps interest cut
The Fed cut 50bps interest rate and the ECB pivoted suggesting it is ready to take appropriate measures, while the G7 pledged a coordinated action. However, risky assets failed to gain much traction, while market risk measures such VIX remained high.
Key points
- Key points:
- Fed fund futures still price in additional rate cut.
- The ECB pivoted and seems prone to implement stimuli.
- February’s preliminary Eurozone core inflation inched up to 1.2% YoY in line with expectations.
- Safe haven yields pared increase, with the 10Y yield returning to levels below 1.1%.
- Equity markets rebounded in Europe, but the Fed action failed to spur an additional upward move in U.S. equity markets.
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