Now, another cut is seen at the next Federal Open Market Committee (FOMC) meeting scheduled on March 17–18. “We are heading into a very low interest rate environment for the foreseeable future. We have to accept zero, or negative rates, which was unthinkable 10 years ago,” adds Laxminarayan.
SINGAPORE (Mar 13): This past week, investors around the world have been compelled to swallow and digest fast-unfolding news by the day, if not the hour. The widening Covid-19 outbreak and the shocking breakdown of ties between Saudi Arabia and Russia have caused a volatile cross-infection of uncertainty. “We are living in a period of discovery,” says Bhaskar Laxminarayan, CIO at Bank Julius Baer in Asia.
About the only sure bet is that central banks will cut interest rates further. On March 11, the Bank of England announced an emergency cut of 50 basis points (bps) to 0.25%. This took place less than a week after the US Federal Reserve on March 3 slashed the Fed funds rate (FFR) by 50bps to between 1–1.25%, in what it called a pre-emptive move to avert a recession in the United States.
