March 2 (Reuters) - The U.S. central bank will deliver a big dose of stimulus this month in a bid to protect the world’s biggest economy from the impact of the spread of the new coronavirus, traders of futures contracts tied to the Federal Reserve’s policy rate are betting.
Traders now see a 100% chance of a half a percentage point rate cut at the Fed’s March meeting, according to CME Group’s FedWatch, which translates fed funds futures pricing into traders’ monetary policy expectations. Another half a percentage point of cuts are priced in by July.
That’s up from no chance seen last week, and reflects rising global expectations that global central banks will need to take coordinated action to fend off the worst effects of a world economic slowdown as factories and schools close and public events are canceled in efforts to slow the virus’ spread. (Reporting by Ann Saphir; Editing by David Gregorio)