Fed’s Powell sees solid but slower US economic growth in 2019

WASHINGTON: The US economy will grow at a solid though slower pace in 2019 and the Federal Reserve will remain ‘patient’ in deciding whether to further raise interest rates, Fed chairman Jerome Powell said.

Powell reaffirmed the policy shift made by the US central bank last month, telling a Senate Banking Committee hearing that “crosscurrents and conflicting signals” had weakened the case for further rate increases and made an otherwise positive economic outlook less certain.

“We view current economic conditions as healthy and the economic outlook as favourable,” Powell told lawmakers, projecting that the economy would expand at a solid pace in 2019, albeit somewhat slower than in 2018, and the job market would remain strong. US Treasury yields ticked up modestly. The 2-year benchmark rose to 2.49 per cent, from 2.48 per cent, after the release of Powell’s prepared remarks to the committee.

The S&P 500 index pared earlier losses and was trading flat around midday.