Federal Reserve Chairman Jerome Powell gave opening remarks today in Chicago at a monetary policy conference focused on long-term issues. But what was on everyone’s mind was speculation that global trade worries may force a Fed rate cut.
Financial markets have been nervous lately over an escalating trade war that has spread from China and now could include Mexico and perhaps even the Eurozone. At the same, we are experiencing an inverted yield curve that in the past has been a reliable recession indicator.
“We do not know how or when these issues will be resolved,” he said in prepared remarks. “We are closely monitoring the implications of these developments for the U.S. economic outlook and, as always, we will act as appropriate to sustain the expansion, with a strong labor market and inflation near our symmetric 2 percent objective.”
