WASHINGTON – June 7, 2019 – Although Federal Reserve Chairman Jerome Powell played down speculation of an interest-rate cut this summer only last month, central bank officials are now suggesting that a rate cut might be on the table as early as their June 18-19 meeting based on a gloomy economic outlook and increased trade tensions.
Fed officials must decide what events should trigger a rate cut, how much more information they would need before making a decision, and how to signal their intentions and plans.
During a research conference this week at the Federal Reserve Bank of Chicago, officials indicated in interviews and speeches that they’re paying attention to the risks of a sharper-than-expected economic slowdown and signaled that a rate reduction could be considered at upcoming meetings.
Observers say Fed officials must balance the need to move quickly to shore up growth at the first sign of economic weakness with a need to avoid reacting prematurely to events that could quickly change.
Source: Wall Street Journal (06/06/19) Timiraos, Nick
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