Powell Says 'Somewhat Lower' Rate Path Is Warranted

The FOMC has adjusted its interest rate path due to weak global growth, trade policy uncertainty, and muted inflation. The committee shifted from expecting rate increases to a more patient stance, eventually leading to a rate cut. Economic indicators show strong job growth but slower GDP growth, with manufacturing output declining. Global trends, such as disappointing foreign growth and trade tensions, have influenced these decisions. Inflation remains below target, with muted domestic pressures and persistent global disinflationary forces. The FOMC continues to monitor economic conditions to sustain expansion and achieve its inflation objective.

What prompted the FOMC to change its assessment of the interest rate path?

• Trade policy uncertainty and muted inflation

• Stable unemployment rates

• Strong global growth

• High inflation rates

Which sector showed a decline in output for two consecutive quarters?

• Technology

• Retail

• Manufacturing

• Healthcare

What is the current core inflation rate over the past 12 months?

• 3.5%

• 1.6%

• 0.8%

• 2.0%

What is the committee's expectation for inflation in the long term?

• 4.0%

• 1.0%

• 3.0%

• 2.0%

What is the committee's stance on the future path of the federal funds rate?

• It will maintain current rates indefinitely

• It will decrease rates significantly

• It will monitor economic indicators and act as needed

• It will increase rates immediately