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It began with 75 basis points from the Reserve Bank of New Zealand ended with 50 from the central bank of Mexico.
This week has seen an unprecedented 39 interest rate cuts globally, with monetary-policy heavyweights like the Federal Reserve and the Bank of England to more peripheral central banks in Mongolia and Trinidad and Tobago slashing their benchmarks in emergency moves aimed at combating the economic meltdown from the coronavirus pandemic.
Many of the central banks went further than lowering borrowing costs — often now at record lows — and activated playbooks from the financial crisis: buying bonds, intervening in currency markets and setting up emergency loan programs for banks and companies.
“The bad news is that as policymakers roll out their responses, the extent of economic damage will be increasingly evident soon,” said Ebrahim Rahbari, Citigroup’s global head of currency analysis.
— With assistance by Simon Kennedy
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