Fed slashes rates in emergency coronavirus move

05:13PM Mar 15, 2020
fedratecut-march20-mgn.jpg
The Federal Reserve cut rates to near zero in an emergency announcement on Sunday.
( MGN Image )

By Doina Chiacu and Andrea Shalal

March 15 (Reuters) - With panic buying on Main Street and fear-driven sell-offs on Wall Street, the U.S. Federal Reserve cut interest rates to near zero on Sunday in another emergency move to help shore up the U.S. economy amid the rapidly escalating global coronavirus pandemic.

The Fed already cut interest rates by half a percentage point on March 3 at an emergency meeting, the first emergency cut since the financial crisis in 2008. The central bank said it was cutting rates to a target range of 0% to 0.25%.

U.S. President Donald Trump called the move "terrific" and "very good news."

Americans are waking up to a new reality as coronavirus spreads, with store shelves stripped bare of toilet paper, schools closed and large gatherings banned.

U.S. Vice President Mike Pence said testing for coronavirus was expanding with more than 2,000 labs across the country ready to process tests and 10 states operating drive-through testing.

U.S. Assistant Health Secretary Brett Giroir said there will be 1.9 million high-throughput tests available this week.

Dr. Anthony Fauci, the nation's top infectious diseases expert, said the United States was entering a new phase of coronavirus testing.

The United States has lagged behind other industrialized nations in its ability to test for the coronavirus. In early March, the Trump administration said close to 1 million coronavirus tests would soon be available and anyone who needed a test would get one, a promise it failed to keep.

With limited testing available, U.S. officials have recorded nearly 3,000 cases and 62 deaths. Globally more than 162,000 are infected and over 6,000 have died.

DON'T HOARD

The White House appealed to Americans not to hoard as the coronavirus spreads, reassuring them that grocery supply chains were strong.

Trump held a phone call on Sunday with 30 executives from grocery stores including Amazon.com Inc's Whole Foods, Target Corp, Costco Wholesale Corp and Walmart Inc, the White House said.

Trump tested negative for coronavirus, his doctors said on Saturday, as the president extended a travel ban to Britain and Ireland to try to slow the pandemic.

Travelers returning to the United States and being screened for the coronavirus were met by long lines and massive delays at some major airports, prompting federal officials to deploy more staff and Trump to appeal for patience.

Trump said airport checks are "moving as quickly as possible but it is important to be vigilant and careful.

CLOSURES EXPAND

The U.S. containment measures have so far been mild compared to the nationwide lockdowns imposed in Italy, France and Spain. However, Ohio and Illinois on Sunday ordered all bars and restaurants to close, although carry-out and delivery are still allowed.

"I think Americans should be prepared that they are going to have to hunker down significantly more than we as a country are doing," Fauci said on NBC's "Meet the Press." Elderly people and those with underlying conditions need to be especially cautious.

Fauci said he did not see domestic travel restrictions in the immediate future but warned, as he did last week, that the outbreak would get worse before it gets better.

Asked whether he thought U.S. authorities should impose a 14-day lockdown to try to stop the spread of the virus, Fauci said: "You know, I would prefer (that) as much as we possibly could. I think we should really be overly aggressive and get criticized for over reacting."

Fauci said on CBS' "Face the Nation" the idea of closing restaurants in the United States "might be overkill right now, but everything is on the table." He said he himself would not go to a restaurant.

"If it looks like you're overreacting, you're probably doing the right thing," Fauci said.

Even though Americans are not barred from going to the movies, ticket sales in North America fell to their lowest level in more than two decades this weekend, according to measurement firm Comscore.

View more coronavirus coverage here.

Track the spread of coronavirus with these interactive maps and charts.