US economy not to fall into recession this year: Chairman of Federal Reserve

However, Fed had lowered the growth forecast of the US economy to 2.3 percent during the latest rate hike in December.

Published: 11th January 2019 11:38 AM  |   Last Updated: 11th January 2019 11:38 AM   |  A+A-

US Flag for representation.

By UNI

WASHINGTON: Jerome H. Powell, chairman of the US Federal Reserve (Fed), said on Thursday that the US ​economy would not fell into a recession this year, even though the projections of growth rate dropped.

"There's good momentum going into this year," Powell said during an interview at The Economic Club of Washington DC. In order to elaborate his view on recession, Powell explained that recession was typically resulted from two factors -- the surging of inflation and the explosion of asset bubbles.

"We don't see the two most basic recent causes of recessions," said the helmsman of the central bank.

However, Fed had lowered the growth forecast of the US economy to 2.3 percent during the latest rate hike in December.

World Bank, an international financial institution, also expected the growth rate of the US ​economy would drop to 2.5 percent in 2019.

As the monetary policy making agency in the United States, Fed recently switched to a more dovish tone for its path of interest rate hikes.

The central bank lowered its projections on the number of rate hikes in 2019 from 3 to 2 during the latest rate hike announcement.

Speaking of the pace of rate hikes, Powell said the Fed "don't actually vote on a path or a plan for interest rates."

"We're in a place where we can be patient and flexible and wait and see what does evolve," Powell said.

According to the minutes of the Fed's December 18-19 monetary policy meeting released Wednesday, Fed policy makers thought they "could afford to be patient" with future rate hikes.

Stay up to date on all the latest Business news with The New Indian Express App. Download now
(Get the news that matters from New Indian Express on WhatsApp. Click this link and hit 'Click to Subscribe'. Follow the instructions after that.)
TAGS
US economy

Comments

Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the newindianexpress.com editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on newindianexpress.com are those of the comment writers alone. They do not represent the views or opinions of newindianexpress.com or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. newindianexpress.com reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp