U.S. official warns of recession risk if interest rates go much higher

Consumer credit outstanding

The Fed chair also warned that if an "extended shutdown" took place, the impact on the economy "would show up in the data pretty clearly".

Federal Reserve Chairman Jerome Powell on Thursday stressed again that the US central bank can be patient in approving any further rate increases as officials gauge whether the USA economy will slow this year, as some in financial markets worry, or continue motoring ahead as the Fed itself expects.

Even so, USA central bankers face a challenging year that's complicating their communication.

The monthly reductions, effectively running on autopilot, have been criticized by some as a steady tightening of financial conditions the Fed should reconsider.

Powell and others have been less demonstrative and noted that economic data remains strong, particularly after a recent payroll report that showed more than 300,000 jobs added in December.

Still, Powell's comments and those of other officials "are developing a new narrative".

"We would have a less clear picture into the economy if it were to go on much longer", Powell said.

Part of that message is meant to downplay the significance of the policy projections that officials issue every three months.

U.S. Treasury debt prices erased early gains after a soft 30-year bond auction and in reaction to Powell's comments on the Fed "substantially" reducing the size of its balance sheet.

Mr. Clarida said monetary policy, after four rate increases past year, isn't on "preset course".

JPMorgan Chase has estimated that the partial government shutdown - which is 20 days old Thursday - is shaving $US1.5 billion off the economy each week, a modest amount in the context of a $US20 trillion economy, the damage will keep growing.

While growth is widely expected to slow this year from last year's roughly 3% expansion, Mr. Clarida said that the economy will likely continue expanding faster than its long-term trend in 2019.

The prospect of rising interest rates that could slow the economy spooked investors and contributed to the downturn in United States and global stock markets late past year. "The US Chamber of Commerce, which represents millions of businesses, projects low unemployment, modest inflation and 2.6 per cent growth for 2019".

"The principle worry I would have is global growth", Powell said.

During an interview at The Economic Club of Washington, D.C., Powell said that continued shutdown stopped some of the data feed that the Fed needed, making the outlook of US economy less clear, thus complicating policy-making.

Related:

  • A timeline of events in the Jayme Closs disappearance case

    A timeline of events in the Jayme Closs disappearance case

    Since Jayme's disappearance almost three months ago, scores of people in Wisconsin and Minnesota helped authorities look for her. Both the woman and the neighbour recognised Jayme from the massive publicity the case has drawn, authorities said.
    Trump Threw 'Temper Tantrum' After Dems Refused Border Wall, Chuck Schumer Says

    Trump Threw 'Temper Tantrum' After Dems Refused Border Wall, Chuck Schumer Says

    But Tuesday morning, Pelosi and Schumer announced that they would "deliver a response to President Trump's 9:00 p.m. Democrats have accused the President of over blowing the situation and manufacturing a crisis.
    Klopp on Lovren injury latest and Hoever debut

    Klopp on Lovren injury latest and Hoever debut

    This could suggest that Klopp is willing to use the FA Cup as a platform for the youth players to come in and express themselves. With Naby, and I spoke to him, everything is fine and I am completely happy. "We can do much better in a game that suits more".
  • Meet the Fiji water girl who went viral at the Golden Globes

    Meet the Fiji water girl who went viral at the Golden Globes

    The model made it into the majority of the red carpet snaps. " Fiji Water woman knows she deserves to be in the shot". She claims the Golden Globes was a once in a lifetime experience, despite having been in the industry for 12 years.
    Samuel L. Jackson Reveals Captain Marvel Can Time Travel

    Samuel L. Jackson Reveals Captain Marvel Can Time Travel

    We have to say that it is an impressive piece of concept art and is quite in line with Anthony and Joe Russo's upcoming movie. And we also get to see and hear more of Jude Law's Yon-Rogg - or is he Mar-Vell? - in action.
    Trump says wall can be a steel fence

    Trump says wall can be a steel fence

    Democratic Senators are making it clear they will block such plans, arguing bills funding the government should be first. He also said he could declare a national emergency to build the proposed border wall without the approval of Congress.
  • Callum Hudson-Odoi ready for Chelsea first team - Maurizio Sarri

    Callum Hudson-Odoi ready for Chelsea first team - Maurizio Sarri

    Bundesliga champions Bayern were reported to have made an improved £35million offer for Hudson-Odoi earlier on Tuesday. The 18-year-old played the full game on Saturday as Chelsea beat Nottingham Forest in the third round of the FA Cup .
    Celtic player could be set to move to arch-rivals Rangers

    Celtic player could be set to move to arch-rivals Rangers

    Jermain Defoe will be a "huge hit" at Rangers , according to the man who coached the striker at three separate clubs. Defoe joined Bournemouth on a free transfer in June 2017 following Sunderland's relegation from the Premier League.
    Garbage, feces take toll on national parks amid shutdown

    Garbage, feces take toll on national parks amid shutdown

    All other visitors will be asked to enter Yosemite using the Highway 140 entrance and enter the park via the El Portal Road. Plus, the National Park Service website will not be updated, leaving visitors in the dark about campground re-openings.
  • Future talks about former collaborator R. Kelly:

    Future talks about former collaborator R. Kelly: "Man, who is that?"

    Kelly and I have sometimes very untrue things written about us, so in a way this was a bond between us", she said at the time . She felt compelled to make a public statement to aid victims after her office was inundated with calls to take action.
    May's govt suffers defeat over no-deal tax powers

    May's govt suffers defeat over no-deal tax powers

    These assurances are set to be delivered to lawmakers before they vote, although not before they start their debate on Wednesday. Mrs May was forced to pull the vote on her deal in December after she said it would be defeated by a large majority.
    Pelosi takes speaker's oath of office surrounded by children

    Pelosi takes speaker's oath of office surrounded by children

    They are the majority in the most diverse Congress in U.S. history, including a record number of women and members of minorities. How has the shutdown come about? On Thursday, she was re-elected to the office , as Democrats took control of the House.

Comments

Latest news

What happens if Trump declares national emergency at the border?
Democrats in Congress have refused to approve a spending bill that includes the $5.7 billion Trump has demanded for the wall. Trump told reporters, adding later, "If we don't make a deal, I would say 100 percent but I don't want to say 100 percent".

Hasan Salihamidzic: Bayern Munich really want to sign Callum Hudson-Odoi
The latest is believed to meet Chelsea's valuation of the player and Bayern Munich are awaiting a response. You can see it from both sides.

Meghan Markle's Baby Bump Takes Center Stage for Visit to Patronage
Markle visited the London headquarters of Smart Works on Thursday and helped a woman pick out an outfit for her new job. She has a background in TV and the arts, and has campaigned on gender inequality and animal rights throughout her life.

US, China leave future of trade talks unclear
The paper said in an editorial that the dispute harms both countries and disrupts the global trade order and supply chains. He added that China and the United States would "maintain close communication" on a potential next round of talks.

Google Assistant makes its way into Google Maps
It incorporated a similar feature into earbuds in November 2017 and already offers a similar service via Google Translate . In the past year or so, every major consumer electronics exhibition is all about the Google Assistant or Alexa .

Oldham Upsets Fulham, Newport Beats Leicester in FA Cup Giant Killing Sunday
Newport manager Michael Flynn was ecstatic at the final whistle and described the victory as being in his top three career highlights.

Amazon finally answers how many Alexa devices have been sold
Were it not for those Android phones and tablets, the number of devices compatible with Google Assistant would be much lower. Amazon has announced that it has sold over 100 million devices with its Alexa smart assistant built-in.

Kelly As A "Serial Child Rapist" In Angry Tweets
Since Cunningham's explosive revelation, Aaliyah's mother has come out swinging, vehemently denying the allegations against Kelly. Born Robert Sylvester Kelly, the 51-year-old award-winning singer's sexual misconduct has always been the subject of rumor.

United States warns citizens of arbitrary action in China
Spokeswoman Hua Chunying says Canada should "correct its mistakes" and stop acting at the behest of the United States. But Beijing-based Western diplomats and former Canadian diplomats have said they have no doubt the cases are linked.

Grizzles acquire Justin Holiday from Bulls
It has always been thought that the Bulls would try end rid themselves of a player or two, prior to the February 7 trade deadline. He holds career National Basketball Association averages of 8.0 points, 2.1 rebounds and 1.4 assists in 17.3 minutes per game.

Man City Hosts Liverpool in Vital Clash in Premier League Title Race
It's something from within, it's desire, it's something you can't describe and today it was there and it made us a better team. It produced a thrilling encounter and Sane said the players could feel the tension with so much at stake.

Remember China, China, China: acting United States defence chief Shanahan
Acting Defence Secretary Patrick Shanahan took part in the Cabinet meeting. "We're not talking about vast wealth", Trump said. David Norquist, the Pentagon's comptroller, will perform the duties of the deputy as well as retain his current title.

Signs of GOP unease over shutdown ahead of White House talks
Pelosi began her campaign to regain the speaker's job, which she held from 2007 until 2011, immediately after the election. One seat in the 435-member House remains in dispute two months after the election.

How to Watch Cardiff City vs
Tottenham Hotspur returned to winning ways with a 3-0 victory against Cardiff City at the Cardiff City Stadium on New Year's Day. The victory took Spurs back above City into second place and within six points of leaders Liverpool .

Bird Box Challenge Emerges After Netflix Movie's Release
Social media users have been posting various videos of themselves doing mundane tasks while wearing a blindfold. Sandra Bullocks' new film Bird Box was one of the most talked about new films over the holiday season.

Other news