February 28, 2020 / 3:57 PM / a month ago

Bullard: Market pricing will not dictate rate cut, Fed policymakers will monitor events up to March FOMC

FORT SMITH, Ark. (Reuters) - The Federal Reserve does not need to cut U.S. interest rates just because markets have priced in aggressive central bank action, but policymakers will be monitoring events closely up to the upcoming March 17-18 meeting, St. Louis Federal Reserve bank president James Bullard said on Friday.

Asked whether the current high market probability of a cut would force the Fed’s hand, Bullard said, “No I don’t,” but added “I would not want to prejudge the March meeting. Obviously the situation is very fluid and we are going to want to monitor events right up until the meeting.” Asked about the possibility of an emergency meeting to cut rates he noted the situation “could turn around very quickly” if the virus is controlled.

Reporting by Howard Schneider; Editing by Chizu Nomiyama

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