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According to the economists at Goldman Sachs, the US Federal Reserve (Fed) could likely cut interest rates aggressively before its March 17-18 monetary policy meeting.

This comes after Fed Chair Jerome Powell on Friday, in an unscheduled statement, the Fed is “closely monitoring” developments and “will use [its]tools and act as appropriate to support the economy.”

Key quotes:

Strongly hints at a rate cut at or even before the March 17-18 FOMC (Federal Open Market Committee) meeting.

Now expect a cut of a half percentage point by March 18.

Forecast an additional half percentage point in the second quarter for a total reduction of 1 percentage point from the Fed’s current target range of 1.50-1.75%.

Does not expect the Fed to act in a vacuum.

Specifically, we see a high risk that the easing we expect over the next several weeks occurs in coordinated fashion, perhaps as early as the coming week.

Chair Powell’s statement on Friday suggests to us that global central bankers are intensely focused on the downside risks from the virus.

We suspect that they view the impact of a coordinated move on confidence as greater than the sum of the impacts of each individual move.

Expects a total of 100 basis points of cuts in the near term from the Bank of Canada, which meets this week.

Sees 50 basis points of easing from central banks in Britain, Australia, New Zealand, Norway, India and South Korea; and 10 basis points from the European Central Bank and Swiss National Bank.

One bank left out of its forecast for cuts was the Bank of Japan, which it sees leaving rates on hold.

Central bankers will still want to do their part to support the economy, especially at a time when few of them worry about inflation rising too much.

This implies that if the news on the virus and the economy remains negative in the near term, central banks may well react aggressively even if the impact on economic growth is limited.