Las Vegas Review-Journal (Sunday)
■ Federal Reserve officials said risks to the economy have lessened.
Overall economic risks ease, but virus a worry
WASHINGTON — The Federal Reserve believes that downside risks to the U.S. economy have lessened with the easing of trade tensions and better prospects for global growth, but officials note a concern that possible spillovers from a deadly virus in China represent a new threat.
In its semi-annual monetary policy report released Friday, the Fed did not signal any imminent changes in its benchmark interest rate, which it cut three times last year to the historically low range of 1.5 percent to 1.75 percent.
After quarter-point rate cuts at the July, September and October meetings, the Fed said it has viewed the present level of interest rates to be “appropriate to support sustained expansion of economic activity” and a strong labor market and inflation rising to the Fed’s 2 percent target.
Federal Reserve Chairman Jerome Powell will testify before congressional committees on the new report on Tuesday and Wednesday, and his testimony is expected to amplify the Fed’s view that no more changes in interest rates are needed.
Many economists believe the Fed will keep rates unchanged for the entire year, but some analysts think there is still the chance of one more rate cut in response to risks such as the coronavirus outbreak in China.
In the report, the Fed said the slowdown in global growth, which had dragged down U.S. manufacturing, appeared to be leveling off. But the virus outbreak “could lead to disruptions in China that spill over to the rest of the global economy.”