U.S. Economic News
March 16, 2020
U.S. Economic Indicators
The Empire State Manufacturing Survey indicates that business activity declined in March, as the headline index fell 34.4 points to -21.5, its lowest level since 2009. The new orders index dropped 31.4 points to -9.3, and the shipments index fell 20.6 points to -1.7; meanwhile, the index for number of employees declined 8.1 points to -1.5, and the hours worked index fell 9.6 points to -10.6. NY Fed Report
U.S. News
The Wall Street Journal reports that the Fed has announced a reduction in the federal-funds rate target range to 0 – 25 basis points and a $700 billion round of quantitative easing as part of a series of actions aimed at stabilizing markets as the novel coronavirus pushes the U.S. economy toward a recession. The severity and length of the economic fallout will depend on the Fed’s ability to keep liquidity flowing, the extent of coronavirus testing capabilities, and the success of fiscal stimulus measures intended to boost demand. WSJ
The Financial Times reports that the effects of the coronavirus are beginning to ripple through the real economy as service firms, those most dependent on human contact, start suffering losses. While the early consequences of the coronavirus outbreak were largely supply chain disruptions, the spread of the virus in the U.S. is beginning to threaten smaller service companies like restaurant and bar owners with low cash reverses and already-limited credit access. FT