The Federal Reserve on Tuesday handed down an emergency interest rate cut to combat any slowdown the US economy could see from the spreading coronavirus outbreak.
The 50-basis-point cut was an unexpected and rare move showing that the central bank considers a coronavirus outbreak a threat to the US economy.
But the lower interest rates coupled with coronavirus could do more harm than good and lead the US economy to a toxic situation where prices surge but growth slows, Nancy Davis, portfolio manager of the Quadratic Interest Rate Volatility and Inflation Hedge ETF (IVOL) told told Markets Insider in an interview.
This article contains the opinion of the manager. It should not be regarded as investment advice.