Brian Chappatta, Columnist

Powell Slams Door on Trump's Negative Rates ‘Gift’

The Fed chair will never say never, but he came as close as he could during remarks on Wednesday.

May 13, 2020 at 3:07 PM UTC

Brian Chappatta is managing editor of Bloomberg News' leveraged finance and distressed debt teams. He was previously managing editor and team leader of its wealth group. Before that he was a Bloomberg Opinion markets and finance columnist and a bonds reporter for Bloomberg News.

All hands on deck.
Photographer: Andrew Harrer/Bloomberg

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Federal Reserve Chair Jerome Powell made two things clear during much-anticipated remarks on Wednesday. First, fiscal policy might need to do more to combat the lasting economic damage from the coronavirus pandemic. Second — in what markets were most eager to hear — he’s not about to steer the central bank down the path to negative interest rates.

“The evidence on the effectiveness of negative rates is very mixed,” Powell said Wednesday in a webinar hosted by the Peterson Institute for International Economics. To hammer home the point: “This is not something that we’re looking at.”