(Reuters) – The coronavirus poses “evolving risks” to the U.S. economy and U.S. central bank officials are monitoring developments closely, New York Federal Reserve President John Williams said on Thursday.

Fed officials are coordinating with central banks around the world in efforts to shield the global economy from the downside risks of the virus and to ensure that financial markets are running smoothly, Williams said, at a dinner organized by the Foreign Policy Association.

“The outlook is evolving and highly uncertain,” Williams said. “In the weeks and months ahead, we will continue to closely monitor developments and their implications for the economic outlook.”

The Fed cut interest rates by half a percentage point Tuesday in an emergency move intended to protect the U.S. economy from the impact of the coronavirus. The Fed’s target rate is now at a range of 1.00% to 1.25%.

Williams said the U.S. economy started the year with “very good momentum,” powered by solid jobs growth and geopolitical risks appeared to be receding. But the outbreak and spread of the coronavirus over the past month has brought new risks, he said.

U.S. businesses are facing supply chain disruptions and weak demand, Williams said. Tourism and travel companies are taking a hit as consumers become cautious, he added.

Worries about the coronavirus have roiled markets, sparking a sharp selloff in U.S. equity markets and pushing 10-year Treasury yields to record lows.

Williams also said the U.S. central bank will make sure that there is an ample supply of reserves in the banking system.

The New York Fed has been intervening in money markets since mid-September, when a shortage of cash led to a spike in short-term borrowing rates. Demand for the central bank’s operations in the market for repurchase agreements, or repo, has been strong this week in a sign that some financial firms may be trying to shore up reserves. However, the federal funds rate, which the Fed targets to influence borrowing costs, has stayed within the Fed’s target range.

The Fed is also purchasing $60 billion a month in short-term Treasury bills in an effort to increase the level of reserves in the banking system. Policymakers have discussed scaling back the repo operations and the bill purchases in the second quarter, but some analysts wonder if the Fed will need to delay those plans because of the uncertainty caused by the coronavirus.

“We remain flexible and ready to make adjustments to our operations as needed to ensure that monetary policy is effectively implemented and transmitted to financial markets and the broader economy,” Williams said Thursday.

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