Coronavirus: Can the risk be contained?

Business Daily

BBC

News, Business

4.4 • 796 Ratings

🗓️ 16 March 2020

⏱️ 18 minutes

🔗️ Recording | iTunes | RSS

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Summary

The US has cut interest rates to almost zero and launched a $700bn stimulus programme in a bid to protect the economy from the effect of coronavirus.

Ed Butler asks Chris Ralph, chief global strategist at St. James’s Place Wealth, whether anything can prop up the financial markets and minimise the economic impact as the US and Europe go into lockdown, with governments shutting down nightlife and ordering the elderly to stay home.

Professor Liam Smeeth, epidemiologist at the London School of Hygiene and Tropical Medicine, talks to us live about how much these measure can help contain the virus. Can we expect the virus to ease off as the northern hemisphere heads towards summer? When and how will the pandemic end? And what is the best strategy to contain or at least limit the pathogen's progress?

(Picture: President Trump at a White House press conference on Sunday; Credit: Getty Images)

Transcript

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0:00.0	Hello there, I'm Ed Butler. Welcome to Business Daily from the BBC. Coming up, as the US economy
0:06.9	grinds to a halt, will small businesses survive? We made a decision yesterday to lay off our entire
0:14.3	hourly team. It's devastating and it's heartbreaking and these are people's livelihoods. And while
0:20.3	shops, businesses, and it seems all public life is closing down,
0:24.3	how are the financial markets coping?
0:26.9	The word panic has come up a lot over the past week.
0:30.0	Now is not the time to panic in trying to take decisions
0:32.7	in the heat of a storm when facts are unclear.
0:35.9	The heat of the storm, Business Daily from the BBC.
0:41.7	Now in a move that caught investors by surprise on Sunday night, the Federal Reserve, along with the
0:46.6	European Central Bank, Bank of England, Bank of Japan, SMB and Bank of Canada all through the kitchen
0:52.7	sink at the financial markets, it seems, as events over the weekend took further turns for the worst across Europe and the US in the coronavirus outbreak.
1:02.7	The US cut interest rates to almost zero. It launched a $700 billion stimulus program in a bid to protect the economy from the effects of the disease.
1:13.6	The rapidly evolving situation has led to high volatility and financial markets.
1:18.0	To prevent this from happening, we will purchase at least $500 billion of Treasury securities over the coming months.
1:23.0	We think we have plenty of policy space left, plenty of power left in our tools.
1:27.4	Plenty of power left in his tools, the words there of Jay Powell, the head of the Federal
1:31.3	Reserve, where President Trump seemed delighted by that move. He's been calling for it since long
1:36.6	before the virus even started to spread. I think that people in the market should be very
1:41.5	thrilled, and that brings us the strongest country in the world by far,
1:46.2	financially in every other way. And that brings us in line with what other countries are.
1:51.8	They actually have negative rates, but look, we got it down to potentially zero. So that's a big step.
	...

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