Fed Chief Powell Says Economy Sending 'Conflicting Signals'
Tuesday, 26 February 2019 22:16 WIB | FISCAL & MONETARY |Federal Reserve

Federal Reserve Chairman Jerome Powell on Tuesday said the economy has been sending "conflicting signals" that justify a "patient approach" on future changes to interest rates.

œWhile we view current economic conditions as healthy and the economic outlook as favorable, over the past few months we have seen some crosscurrents and conflicting signals, Powell said in testimony prepared for delivery to the Senate Banking Committee.

The Fed chairman did not give a ringing endorsement of the economic outlook, saying only that in January œmy colleagues and I generally expected the economy to expand at a solid pace in 2019.

œIn the last couple of months, some data have softened but still point to spending gains this quarter, he noted.

At the Fed™s last interest-rate committee meeting, Powell and his colleagues decided they will be patient about further interest rate hikes. For economists, this generally means no tightening at least until much later this year.

The market has actually priced in a small chance of an interest-rate cut by December.

Minutes of the Fed™s January meeting show two camps among top officials, with some saying they expected to raise interest rates if the economy remains healthy and the outlook favorable, while others noting it would take some sign of higher inflation to justify further tightening.

Powell did not take sides, saying only that œgoing forward, our policy decisions will continue to be data dependent and will take into account new information as economic conditions.

Powell told lawmakers that the crosscurrents and conflicting signals come in large part from financial markets.

œFinancial markets became more volatile toward year-end, and financial conditions are now less supportive of growth than they were earlier last year, he said.

In addition, œgrowth has slowed in some major foreign economies, particularly China and Europe, the Fed chairman said.

œAnd uncertainty is elevated around several unresolved government policy issues, including Brexit and ongoing trade negotiations, he added.

œIn January, with inflation pressures muted, the FOMC determined that the cumulative effects of these developments, along with ongoing government policy uncertainty, warranted taking a patient approach with regard to future policy changes, the Fed chairman said.

Powell said that the partial government shutdown will only have œfairly modest negative effects on the economy.

Source : Marketwatch

RELATED NEWS

Carney Says No-Deal Brexit Would Probably Lead to BOE Easing
Saturday, 24 August 2019 03:44 WIB

A collapse of Brexit talks resulting in the U.K. leaving the European Union without a transition agreement would likely prompt the Bank of England to loosen monetary policy, Governor Mark Carney said. While the Monetary Policy Committee™s reaction would depend on how demand, supply and ...

Powell: U.S. in 'favorable' place, Fed will 'act as appropriate'
Friday, 23 August 2019 21:23 WIB

The U.S. economy is in a "favorable place" and the Federal Reserve will "act as appropriate" to keep the current economic expansion on track, Fed chair Jerome Powell said on Friday in remarks that gave few clues about whether the central bank will cut interest rates at its next meeting or not. The ...

Fed Saw July Rate Cut as Insurance for Growth and Inflation
Thursday, 22 August 2019 01:24 WIB

Federal Reserve officials viewed their interest-rate cut last month as insurance against too-low inflation and the risk of a deeper slump in business investment stemming from uncertainty over President Donald Trump™s trade war. œMembers who voted for the policy action sought to better position ...

Australia Central Bank Board Discussed Unconventional Policy at August Meeting
Tuesday, 20 August 2019 09:04 WIB

Australia's central bank discussed unconventional monetary policies, including negative interest rates, at its August board meeting as it left the door ajar for further easing having already cut rates twice to 1%. Minutes of the Reserve Bank of Australia's (RBA) Aug.6 meeting showed it would consid...

RBA releases quarterly Statement on Monetary Policy: Repeating the same dovishness
Friday, 9 August 2019 08:55 WIB

The Reserve Bank of Australia has released its quarterly Statement on Monetary Policy. This follows a recent hold in interest rates and a brief statement that indicated fairly modest changes compared to May.  "The RBA's œcentral scenario is for the Australian economy to grow by around 2½ per...

ANOTHER NEWS
European Stocks Open Lower Amid Rising US-China Trade Tensions
Monday, 26 August 2019 14:25 WIB European stocks opened lower on Monday as investors reacted to the latest escalation in the U.S.-China trade war. The pan-European Stoxx 600 fell about 0.5% during morning deals, with sectors and major bourses broadly in the red. U.K. markets are...

DISCLAIMER

Seluruh materi atau konten yang tersaji di dalam website ini hanya bersifat informatif saja, dan tidak dimaksudkan sebagai pegangan serta keputusan dalam investasi atau jenis transaksi lainnya. Kami tidak bertanggung jawab atas segala akibat yang timbul dari penyajian konten tersebut. Semua pihak yang mengunjungi website ini harus membaca Terms of Service (Syarat dan Ketentuan Layanan) terlebih dahulu dan dihimbau untuk melakukan analisis secara independen serta memperoleh saran dari para ahli dibidangnya.