CHICAGO (Reuters) – The Federal Reserve will respond “as appropriate” to the risks posed by a global trade war and other recent developments, Fed Chairman Jerome Powell said on Tuesday in remarks that seemed to open the door to the possibility of a rate cut.
In a brief statement included as part of a speech on broader monetary policy issues, Powell said the Fed was “closely monitoring the implications” of a trade dispute that has, since the Fed’s last meeting, disrupted global bond and equity markets and posed risks to U.S. and world economic growth.
“We don’t know how or when these issues will be resolved,” Powell said. “As always, we will act as appropriate to sustain the expansion, with a strong labor market and inflation near our symmetric 2% objective.”
His remarks did not include a reference to the current Fed target interest rate as appropriate, or repeat the pledge to be “patient” before raising or lowering rates again – both standard talking points…
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