UPDATED 7:08 PM PT — Wednesday, November 13, 2019
Federal Reserve Chair Jerome Powell signaled a likely pause in interest rate cuts, due to improved GDP growth projections. In his congressional testimony on Wednesday, America’s top central banker said U.S. economic growth gained momentum in the third quarter.
“We see the current stance of monetary policy as likely to remain appropriate,” stated Powell.
The chairman said this happened partially due to recent decreases in Fed borrowing costs. He suggested base interest rates will likely remain unchanged going forward, unless the U.S. faces expected economic shocks.
“Looking ahead, my colleagues and I see a sustained expansion of economic activity, a strong labor market and inflation near our symmetric two percent objective as most likely,” said Powell. “This favorable baseline partly reflects the policy adjustments we have made to provide support for the economy.”
Powell’s statement contradicts President Trump’s stance on the matter. The president recently called for negative interest rates to boost America’s GDP growth and international competitiveness.
….our manufacturers. We should have lower interest rates than Germany, Japan and all others. We are now, by far, the biggest and strongest Country, but the Fed puts us at a competitive disadvantage. China is not our problem, the Federal Reserve is! We will win anyway.
— Donald J. Trump (@realDonaldTrump) October 31, 2019