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[The Federal Reserve announced an emergency rate cut and the benchmark interest rate was cut by 50 basis points to address the risks to the economy caused by public health events.] The Federal Reserve's Federal Open Market Committee said that the fundamentals of the US economy remain strong and will closely monitor economic development and its impact on the economic outlook. Impact, and will use relevant tools to take appropriate action to support the economy. 

[Powell: A rate cut is not enough to solve the supply chain problem] Powell said that the rate cut is to help the US economy stay strong during the crisis. Monetary policy is an important tool to boost the economy, but a single rate cut is not enough to solve the supply chain problem. 

[API report: US crude oil inventories increased by 1.69 million barrels to 447 million barrels last week] Gasoline inventories decreased by 3.9 million barrels and refined oil inventories decreased by 1.7 million barrels. US crude oil imports increased by 111,000 barrels per day last week.

[U.S. President Trump: The Federal Reserve must further loosen policy, this is the last time for the Federal Reserve to take a step ahead. The Federal Reserve must relax its policies and cut interest rates; the Federal Reserve rate is still too high, and disappointed that the Federal Reserve is only following but not leading] 

[Fed Meister: Doubts about the advantages of negative interest rates outweigh the disadvantages, health events will at least weigh on US GDP growth in the first half of 2020]

[The live broadcast of the meeting between the OPEC and non-OPEC oil-producing ministerial supervisory committees will begin at 19:00 on Wednesday, Beijing time] OPEC representatives: OPEC + Joint Technical Committee proposes to reduce production by 600 to 1 million barrels per day.

[Villeroy, European Central Bank Management Committee: The European Central Bank ’s monetary policy has been “very loose” and if necessary, the central bank will be ready to take appropriate and targeted measures, and governments with fiscal space should use it]

[History for the first time! US 10-year Treasury yield fell below 1%] On Tuesday, the benchmark 10-year Treasury yield fell to a record low of 0.984%, and the yield on the 30-year Treasury also hit a record low of 1.601%. As the epidemic sparked fears of continued economic slowdown and even recession, investors fled stocks and rushed into bonds for security.


GMT(time)

Currency

News and Data

02: 00

USD

Fed Interest Rate Decision

1130

AUD

GDP (QoQ)(Q4)

20: 30

GBP

Composite PMI (Feb)

20: 30

GBP

Services PMI (Feb)

Tentative

GBP

BoE MPC Treasury Committee Hearings


Summary of Institutional Perspectives


CIBC: Bank of Canada is expected to cut interest rates by 50 basis points on Wednesday and another 25 basis points in April




The Canadian Imperial Commercial Bank (CIBC) wrote on Tuesday (March 3) that the Bank of Canada is expected to cut interest rates by 50 basis points on Wednesday, compared with 25 basis points previously expected. CIBC analysts said that the Fed has already shot today, but it does not mean that they cut interest rates by 50 basis points, because we have expected such results, but it is surprising that they did not wait for the policy meeting this month. It's been about two weeks. This shows the Fed's concern about the current situation.

For the Bank of Canada, a rate cut this week is inevitable, but it will certainly not be an action between policy meetings. The door of a 50 basis point rate cut has now been opened. We previously expected a 25 basis point rate cut this week and then another 50 basis points in April. But considering that the Fed has already acted so aggressively, we still slightly change our current expectations (for example, a 50 basis point rate cut tomorrow and another 25 basis points in April). At present, Canada has not experienced the same level of community-based transmission as the United States, but considering the transportation links between the United States and Canada, I believe that the outbreak in Canada is unavoidable.

Deutsche Bank: The European Central Bank is expected to follow the Fed's actions and cut interest rates by 10 basis points




Commerzbank's chief economist Joerg Kraemer said in a report on Tuesday that as the outlook worsens, European Central Bank officials in Frankfurt may cut deposit rates by 10 basis points at next week's meeting and increase monthly debt purchase 20 billion euros ($ 22.3 billion).

Kraemer wrote that, although the negative interest rate policy has caused some harm, "the European Central Bank is likely not to want to give up the signal effect of interest rate cuts in order to impress the market even more." The European Central Bank may combine interest rate cuts with increased reserves to ease the burden on banks. Commerzbank also cut Germany's growth forecast for 2020 by half to 0.4%. The euro area is expected to grow by 0.5%, which is lower than the 0.9% growth previously forecast.


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