Government has called on Bermuda’s banks to cut their base interest rates in the face of the threat posed by the coronavirus.

Pointing to Tuesday’s move by the US Federal Reserve to cut its benchmark interest rate by 50 basis points to a range of 1 per cent to 1.25 per cent, Government said it “believes that in a similar fashion Bermuda’s local banks should reduce their base rates”.

A government spokesperson said: “The coronavirus has had a negative impact on global commerce; affecting travel as well as the supply of goods. Bermuda will not be immune from this impact and we therefore all need to work together in order to get through the economic challenges ahead.

“The Government believes that in a similar fashion Bermuda’s local banks should reduce their base rates. A reduction in local banks’ base lending rates in line with the Fed’s action will go a long way towards helping us weather this impending storm.”

Government said the move by the US Federal Reserve “followed an earlier announcement by the G7 finance ministers in which they stated they will use ‘all appropriate policy tools’ to tackle the negative economic impact of the coronavirus.

“Federal Reserve chairman Jerome Powell stated that, ‘The virus and the measures that are being taken to contain it will surely weigh on economic activity for some time, both here and abroad’.

“More importantly he stated, ‘We don’t think we have all the answers. But we do believe that our action will provide a meaningful boost to the economy’.”

We reached out to the island’s four banks for comment yesterday, but none of them had responded by press time.