Fed Signals for a ‘Patient’ Rate Hikes in 2019
Fed's Powell says he would "need to see a need for further rate hikes, signaling a 'patient' move.
Fed Chairman Jerome Powell, on Wednesday, signaled that its three-year-drive to tighten monetary policy may be at an end, keeping the rate hike at 2.5%.
In his statement, he mentioned that the case for rate hikes had “weakened” in recent weeks, with neither rising inflation or financial stability considered a risk, and “cross-currents” including slowing growth overseas and the self-inflicted wound of a federal government shutdown making the U.S. outlook less certain.
Powell also told reporters that while the U.S. economy was in a good place, slowing growth in China and Europe, Brexit, trade negotiations and the effects of the five-week U.S. government shutdown had sent conflicting signals on the outlook.
Fed would want to see a need for further rate increases. A very important indicator to watch for any decision on another rate hike would be inflation.
