Brian Chappatta, Columnist

Fed’s 100-Basis-Point Shock Rate Cut Expects the Worst

The central bank hopes for the best but braces for an extended period at the zero lower bound.

March 15, 2020 at 11:15 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.

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The Federal Reserve couldn’t wait 69 hours.

The fact that Chair Jerome Powell and his fellow policy makers took drastic action by cutting the central bank’s benchmark interest rate by 100 basis points to a range of 0% to 0.25% was bold in its own right. But to do it on Sunday, just days before the Federal Open Market Committee’s scheduled meeting — which it canceled — and less than two weeks after the Fed’s first emergency rate cut since 2008, conveys an added sense of urgency about the potential economic fallout from the coronavirus pandemic.