As Englander writes in a note titled "Emptying the monetary policy cupboard?", while the Fed may think that aggressively reducing policy rates is a prerequisite to fiscal policy, investors are sceptical that monetary policy is effective (and perhaps so is the Fed). But since "the FOMC may feel that fiscal stimulus is practical politically only if monetary policy is maxed out", the combination of low rates and fiscal stimulus may be the key to enabling borrowers to meet obligations, according to the FX strategist.

In terms of monetary expectations, Englander does not see the Fed doing anything too crazy, and expects the Fed to ease 25bps at its March and April meetings Fed easing likely in March and April, but as he admits, "recent Fed comments and asset market selling have led to markets pricing in just under 60bps for the March meeting." Indeed, markets now price in end-April fed funds rates below 40bps. However, the problem is that per discussions with clients there is "little confidence that easier money will lead to a rapid economic rebound; many feel that that the recent 50bps move may have been 'wasted'."