Powell: US growth threatened by trade wars, global sluggishness
Federal Reserve Chairman Jerome Powell on Wednesday depicted a robust US economy with a healthy job market and rising incomes, but warned of “noteworthy risks” that threaten future growth.
“In particular, sluggish growth abroad and trade developments have weighed on the economy and pose ongoing risks,” Powell said in prepared remarks for testimony before the Joint Economic Committee.
Last month, the Fed cut rates for the third time this year, to a range of 1.5% and 1.75%. Powell said the series of rate cuts have helped to keep the US economy and inflation nearing its target of 2% — the level the central bank considers healthy.
In his remarks, he underscored his message at a press conference following last month’s policy-setting meeting, pointing to persistent trade tensions and slowing global growth as a rationale for recent rate cuts.
He stressed to lawmakers that “policy is not on a preset course,” and the Fed would continue to monitor ongoing developments and act as needed.
“We see the current stance of monetary policy as likely to remain appropriate as long as incoming information about the economy remains broadly consistent with our outlook of moderate economic growth, a strong labor market, and inflation near our symmetric 2% objective,” said Powell.