Risks relating to global trade, as well as to the prospect that Britain would crash out of the European Union, have moved in a "positive direction" since the Fed's last meeting, Powell said, adding that the U.S. economy has remained resilient. There is concern that businesses have slashed spending in recent months and that they could turn around and cut workers next, but so far hiring has remained solid.
The US Federal Reserve has chose to further lower interest rates to the 1.5-1.75% range after previously cutting it to the 1.75-2% range in mid-September.
However, the trade war uncertainty has hit the global economy, and the U.S. data contained concerning signs as well, even as the American consumer continues to carry the weight of the expansion on their backs.
The third rate cut of the year has partly reversed the four hikes that the Fed made last year in response to a strengthening economy.
That used to be sooner than rising global dangers led the Fed to alter route and inaugurate easing credit score. "This isn't the normal context for lowering interest rates".
Investors were widely expecting Wednesday's announcement of a quarter-point cut, to a range between 1.5% and 1.75%.
The Fed is also considering the consequences of a decline in expectations for inflation.
Google owner Alphabet in bid to buy Fitbit
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Lower inflation expectations can be self-fulfilling.
The shift is "a clear sign that the Fed thinks it has done enough for now to achieve the mid-cycle adjustment in interest rates they believe is necessary to limit risks to the US expansion from global developments", Brian Coulton, chief economist at Fitch Ratings, said. In both of those cases, the Fed cut rates just three times as well.
Hence, "it looks like the United States economy can withstand and still prosper" with high interest rates.
"We think any attempt by Chair Powell today to persuade his colleagues to signal an intention to keep cutting rates would be met with real resistance, and we doubt that Mr. Powell feels the need to pick that fight at this point", said Ian Shepherdson, the chief economist at Pantheon Macroeconomics. The US and China reached a temporary trade truce earlier this month and are working on a phase-one agreement.
It's now not sure, even though, how well-known this kind of agreement could well be, and Trump hasn't dropped his possibility to impose contemporary tariffs on Chinese language items on December 15. That is a sign growth is slowing from previous year, when it reached 2.9%.
Reuters reported Tuesday, citing an unnamed USA administration official as saying an interim trade agreement between the US and China might not be completed in time for signing in Chile next month.
Earlier on Wednesday, the government estimated that the economy grew at a tepid but steady 1.9% annual rate during the July-September quarter.