Federal Reserve Chairman Jerome Powell said a healthy U.S. economy has faced some “crosscurrents and conflicting signals” that officials in January decided warranted taking a patient approach to future interest-rate changes.
With inflation pressures “muted,” the Federal Open Market Committee in its decision last month to keep interest rates unchanged “determined that the cumulative effects’’ of its actions and global and financial developments, “along with ongoing government policy uncertainty, warranted taking a patient approach with regard to future policy changes,’’ Powell said in prepared testimony.
Investors took Powell’s remarks in their stride, with the S&P 500 Index little changed. Treasuries remained slightly higher on the day as Powell spoke, while the dollar was marginally lower after swinging between small gains and losses.
The Fed chairman’s remarks showed no bias toward further interest-rate increases or cuts. He said the data point to continued spending gains this quarter, and he expected the negative effects of the government shutdown to “unwind over the next several months.’’
