Powell Says Rate Cut Will Provide Meaningful Economic Boost Amid Virus Risk

The transcript discusses a multifaceted response to economic challenges, involving health care professionals, fiscal authorities, and other public and private sector actors. It highlights the role of monetary policy as a tool to support economic activity, acknowledging its limitations in addressing issues like infection rates and supply chain disruptions. The actions aim to maintain accommodative financial conditions, boost confidence, and avoid tightening financial conditions. Central banks globally are responding according to their contexts.

Who are the primary actors involved in the initial response to a crisis?

• Only state and local governments

• Only healthcare professionals

• Fiscal authorities and businesses

• A combination of public and private sector actors

What is one thing that monetary policy cannot directly influence?

• Business confidence

• Overall economic activity

• Rate of infection

• Household confidence

What is the primary goal of monetary policy during a crisis?

• To reduce infection rates

• To fix supply chains

• To increase taxes

• To support economic activity

How do central banks aim to support the economy?

• By reducing government spending

• By tightening financial conditions

• By boosting household and business confidence

• By increasing interest rates

What is a potential consequence of not maintaining accommodative financial conditions?

• Increased economic activity

• Boosted business confidence

• Tightening of financial conditions

• Improved supply chains