U.S. Fed Rate Remains Steady

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CBJ — U.S. Federal Reserve Chairman Jerome Powell has signalled that short-term interest rates will remain unchanged in the coming months, unless any unexpected signs of worsening economy come to light. As of now, the American economy is humming along quite nicely in spite of trade tensions overseas, and primarily with China.

“Looking ahead, my colleagues and I see a sustained expansion of economic activity, a strong labour market, and inflation near our symmetric two per cent objective as most likely,” Powell said in a written statement to Congress’ Joint Economic Committee.

Fed policymakers are unlikely to cut rates unless the economy slows enough to cause Fed policymakers to make a notable change in their outlook.

The Fed cut short-term rates last month for the third time this year, to a range of 1.5% to 1.75%.

Powell has also urged the U.S. Congress to lower the federal budget deficit so that lawmakers would have more flexibility to cut taxes or increase spending to counter the potential for a recession.

@CanBizJournal

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