New York Fed President John Williams said the outbreak and subsequent spread of the coronavirus “has brought with it new risks to the economic outlook”. “Repercussions” have been “especially strong” in hardest-hit countries, including China, South Korea, Japan, Italy, and Iran. In the US, there were also reports of “supply disruptions and weakening demand” and concerns around tourism and travel sectors, in particular.

Fed’s -50bps rate cut this week was “strong policy action” that provides “meaningful support to the economy and will help sustain the economic expansion. But “the outlook is evolving and highly uncertain”. He added, “in the weeks and months ahead, we will continue to closely monitor developments and their implications for the economic outlook.”

He also noted Fed is monitoring conditions in the money markets closely. “We remain flexible and ready to make adjustments to our operations as needed to ensure that monetary policy is effectively implemented and transmitted to financial markets and the broader economy.”

Dallas Fed President Robert Kaplan hailed Fed’s emergency rate cut this week to counter the impact of coronavirus epidemic. He told Chicago Council on Global Affairs “it’s wise to act sooner, more boldly, and it increases the likelihood that we’ll need to use less policy ammunition” later on.

Separately, he told Bloomberg, “a week is an eternity”, regarding what Fed would do in the upcoming March meeting. “I am going to be watching very, very carefully the path of diagnosed cases,” Kaplan said. “We’re just going to have to see what the actual developments are over the next 10 days, two weeks. That will be a key factor, yes, I will be using to judge what’s appropriate and whether we can wait longer.”

Minneapolis Fed President Neel Kashkari also said it was “prudent” for Fed’s -50bps rate cut. He added, “this was insurance that we took out because nobody knows how bad the virus is going to be. If everybody pulls back at the same time, that in itself can lead to a recession,” he added.

St. Louis Fed President James Bullard risks “obviously are rising” that the coronavirus could be “more severe” than expected. Fed policymakers “made the best judgement we could” regarding this week’s surprise -50bps rate cut. He said Fed is now “positioned for a fairly large outbreak…across a large swath of the population.”

As for another rate cut in the scheduled meeting less than two weeks away, Bullard didn’t want to “prejudge” what will happen there. ” It’s a very fluid situation and we are keeping track of things,” he said. “We can keep our options open there.”

Bullard also said it would be very difficult to prepare the new economic forecasts for the March meeting. “We are going to have very wide confidence bands around those” forecasts, he said. “It continues to be a volatile environment and we continue to be very cognizant of how the virus is evolving and how this is effecting the economy. We are tracking this day by day.”