Fed’s Mester: Economy is in a ‘good spot’ but coronavirus presents risk

Speaking at an event hosted by the Forum of Executive Women in Philadelphia late Wednesday, Federal Reserve Bank of Cleveland President Loretta Mester warned about the impact of the coronavirus outbreak while saying that the US economy is in a good spot.

Key quotes:

There’s no reason the expansion will die of old age.

But business investment has been meek for a number of years due to uncertainty regarding trade.

Coronavirus, now dubbed CORVID-19 by the World Health Organization, can present a risk to economic outlooks as the number of infected and death toll rise.

We’ll have to let it play out a little bit longer to see what the impact will be globally in terms of reduced activity.

It will probably have some damping effect on the global economy, but it’s really too hard to tell what the magnitude will be until we see more data on the prognosis of new cases.

The overnight comments added to the corrective move lower in the US dollar across the board then, especially in light of the cautiously optimistic FOMC minutes.

At the press time, the US dollar index challenges 33-month highs at 99.72, almost unchanged on the day.