• 58 days Could Crypto Overtake Traditional Investment?
  • 63 days Americans Still Quitting Jobs At Record Pace
  • 65 days FinTech Startups Tapping VC Money for ‘Immigrant Banking’
  • 68 days Is The Dollar Too Strong?
  • 68 days Big Tech Disappoints Investors on Earnings Calls
  • 69 days Fear And Celebration On Twitter as Musk Takes The Reins
  • 71 days China Is Quietly Trying To Distance Itself From Russia
  • 71 days Tech and Internet Giants’ Earnings In Focus After Netflix’s Stinker
  • 75 days Crypto Investors Won Big In 2021
  • 75 days The ‘Metaverse’ Economy Could be Worth $13 Trillion By 2030
  • 76 days Food Prices Are Skyrocketing As Putin’s War Persists
  • 78 days Pentagon Resignations Illustrate Our ‘Commercial’ Defense Dilemma
  • 79 days US Banks Shrug off Nearly $15 Billion In Russian Write-Offs
  • 82 days Cannabis Stocks in Holding Pattern Despite Positive Momentum
  • 83 days Is Musk A Bastion Of Free Speech Or Will His Absolutist Stance Backfire?
  • 83 days Two ETFs That Could Hedge Against Extreme Market Volatility
  • 85 days Are NFTs About To Take Over Gaming?
  • 86 days Europe’s Economy Is On The Brink As Putin’s War Escalates
  • 89 days What’s Causing Inflation In The United States?
  • 90 days Intel Joins Russian Exodus as Chip Shortage Digs In
  1. Home
  2. Investing
  3. Stocks

Dow Drops 1,800 Points As The Fed Slashes Interest Rates To Zero

Dow Drops Fed Interest Rates

The Federal Reserve took yet another bold action on Sunday evening, announcing that the central bank would be slashing interest rates to zero percent. But the markets weren't impressed, with the Dow dropping over 2,000 points, and oil prices dropping as much as 10 percent.

In a surprise move by the Federal Reserve Sunday evening, the central bank announced that it will be cutting interest rates to zero percent and reactivating the crisis-era program of bond purchases known as "quantitative easing," in which the Fed buys billions of dollars in bonds to cut prices and keep markets flowing.

The move comes following another announcement last week stating that the Federal Reserve pledged to inject as much as $1.5 trillion into U.S. markets to cull the growing panic sparked by the Coronavirus pandemic.

Trump praised the Fed's action, stating “It makes me very happy, and I want to congratulate the Federal Reserve,” adding, “That’s really good news, that’s really great for our country. … I think people in the market should be very thrilled.”

Oil Can't Catch A Break

Despite the supposedly 'really good news,' oil markets failed to react positively. The price of WTI fell by 8 percent, and Brent dropped by as much as 10 percent following the announcement.

While the coronavirus continues to impact global stock markets, the oil industry is seemingly out against itself. It's abundently clear that the pandemic is impacting oil demand, yet instead of cooperating, the biggest oil nations on the planet are facing off in a price war. Related: Output In World's Largest Copper Mine Is Falling

Russia, for its part, bailed on the OPEC deal, and essentially told other producers to open the floodgates...

And Saudi Arabia responded in kind, suggesting that it was ready to saturate the market with even more oil.

Other OPEC producers joined the free-for-all, with the United Arab Emirates upping its output to 3 million barrels per day, and Iraq adding thousands of barrels to the mix, as well.

By Michael Kern for Oilprice.com

More Top Reads From Safehaven.com:

Back to homepage

Leave a comment

Leave a comment