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Fed’s Powell Predicts Solid, Albeit Slower Growth Ahead
The U.S. economy is expected to remain in a solid expansion mode in 2019, though the pace is likely to slow. That sentiment was revealed in remarks by Federal Reserve Chairman Jerome Powell to Congress on Tuesday.
Powell was quoted by AP News in response to questions by lawmakers on the Senate Banking Committee, “When I say that we are going to be patient, what that really means is that we are in no rush to make a judgment about changes in policy. We are going to be patient. We are going to allow the situation to evolve … and allow the data to come in. And I think we are in a good place to do that.”
Risks identified by Powell included a global slowdown, volatile financial markets and uncertainty about U.S. trade policy.
Powell also pointed out the economy grew at a strong pace last year, while employment and inflation remained near the Fed’s goals. He noted overall growth appeared to rest slightly below 3% in 2018.
The sentiment among many economists is that two planned rate hikes in 2019 may not come to fruition, and the Fed will leave rates unchanged until late this year. Some observers believe there will be no hikes in 2019, though cuts could come next year.
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