Fed Chair raises possibility of interest rate cut to spur economy

ajc.com

Jawboned by President Donald Trump to cut interest rates, Federal Reserve Chairman Jerome Powell told Congress on Wednesday that weaker signs of domestic economic growth in the second quarter combined with trade tensions could lead the Fed to reduce interest rates in coming months in an effort to spur new growth.

"In particular, economic momentum appears to have slowed in some major foreign economies, and that weakness could affect the U.S. economy," Powell told a House committee in his regular update on the economy.

While citing strong growth at the start of 2019, Powell said the second quarter data raises some questions about what is otherwise a strong and health economy.

"However, growth in business investment seems to have slowed notably, and overall growth in the second quarter appears to have moderated," Powell testified.

“We see the economy as being in a good place,” Powell added, as he faced repeated questions from lawmakers about where monetary policy would go next.

Democrats also pushed the Federal Reserve chief to publicly repeat his declaration of earlier this year - that he would not let President Trump push him out of the Fed post.

Asked by panel chair Rep. Maxine Waters (D-CA) what he would do if the President told him he was fired, Powell calmly said he would not quit.

“Of course, I would not do that,” Powell said in a low tone.

“My answer is, I would not do that,” Powell added, saying he fully intends to serve his four year term at the Fed.

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