U.S. Fed Chair Powell hints at possible rate cut as stock plunges for 5th day

U.S. Federal Reserve Chairman Jerome Powell testifies before the House Financial Services Committee during the Monetary Policy and the State of the Economy hearing on Capitol Hill in Washington D.C., the United States, on Feb. 11, 2020. (Xinhua/Ting Shen)

U.S. Federal Reserve Chairman Jerome Powell has hinted at possible rate cut to support the economy, as U.S. stock markets continued to plunge over coronavirus uncertainty.

(Xinhua) — In an attempt to sooth investors, U.S. Federal Reserve Chairman Jerome Powell on Friday signaled that the central bank will cut interest rates to support the economy if necessary, as U.S. stock markets continued to plunge over coronavirus uncertainty.

“The Federal Reserve is closely monitoring developments and their implications for the economic outlook. We will use our tools and act as appropriate to support the economy,” Powell said in a brief statement Friday afternoon.

“The fundamentals of the U.S. economy remain strong. However, the coronavirus poses evolving risks to economic activity,” said the Fed chairman.

His remarks followed an earlier comment from Federal Reserve Bank of St. Louis President James Bullard, who signaled rate cuts are not imminent despite coronavirus concerns.

All three major indexes tumbled into correction territory this week. The Dow Jones Industrial Average dived for the 5th day in a row Friday, falling more than 800 points, or over 3 percent, shortly after the opening bell. The Dow dropped over 3,200 points From Monday to Thursday.

National Economic Council Director Larry Kudlow, President Donald Trump’s top economic advisor, said in a Fox Business interview Friday morning that real-time economic numbers were “holding up nicely” and investors should not rule out “more optimistic options.”

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