FILE PHOTO: Federal Reserve Chair Jerome Powell holds a news conference following the Federal Reserve’s two-day Federal Open Market Committee Meeting in Washington, U.S., July 31, 2019. REUTERS/Sarah Silbiger
ZURICH (Reuters) – The U.S. Federal Reserve will continue to act “as appropriate” to sustain an economic expansion now in its 11th year, Fed Chair Jerome Powell said Friday in Zurich, repeating a pledge that financial markets have taken to signal a further reduction in interest rates.
“Our obligation is to use our tools to support the economy, and that’s what we’ll continue to do,” Powell said at the University of Zurich. The U.S. and world economy are not likely to fall into recession, he said, but they do face risks and “crosswinds,” including from trade uncertainty.
The Fed cut rates by a quarter of a percentage point in July in what Powell characterized as insurance against a downturn amid rising trade policy uncertainty and a global slowdown. Since then trade uncertainty has heightened further, with Washington and Beijing imposing tariffs on each other’s imports earlier this week but promising high-level talks in early October.
Writing by Ann Saphir; Editing by Chizu Nomiyama