Fed's George says she sees no case for interest rate cut

Inflation Expectations Fell in April, Diminishing Risk of Tariff-Led Price Hikes

Inflation Expectations Fell in April, Diminishing Risk of Tariff-Led Price Hikes

Federal Reserve Bank of Kansas City President Esther George said she's opposed to cutting interest rates in order to raise inflation to the central bank's 2% target, warning that could lead to asset-price bubbles and ultimately an economic downturn.

The Fed made its benchmark rate - which influences several consumer and business loans in a range of 2.25% to 2.5 percent.

"The current outlook for inflation appears to be benign", she said.

Mr Trump has attacked the Fed and its chairman Jerome Powell on a number of occasions over the past year, putting pressure on them to keep interest rates low.

Along with the heat he has placed on China, Trump has leaned hard on the Fed to cut its benchmark interest rate.

"The Fed announcement had a more optimistic view of the market, saying that" economic activity improved at a good pace". In March, the Fed stated that it seemed growth had slowed from the fourth quarter.

Stocks are higher on Wall Street and bond returns are reduced ahead of the Federal Reserve's most up-to-date policy statement.

Investors will be closely parsing that the Fed's statement, which is due out Wednesday afternoon, particularly to the Fed thinks the economy is performing some other references. Fed officials raised interest rates four times a year ago but have since signaled an extended pause as they wait for a tight labor market to lift inflation that has been persistently too low. Investors had anxious that the Fed would revolutionize the market if it continued raising borrowing costs.

Bond prices climbed after a report on the manufacturing industry came in weaker than analysts expected. The bank low-rate coverage has helped increase stock prices and affirmed. The S&P 500 Index rebounded Tuesday with a 0.8% advance. The indicators that are available for trading within Europe, where much of the region is closed for a holiday, will also be up slightly, together with Britain's FTSE 100 up 0.1%. The dollar was steady against the yen and euro. That which the mainstream economist is now advocating: interest rate reductions have been called for by president Donald Trump. The US leader said the Chinese may have felt they were "being beaten so badly" in the recent talks that it was better to drag their feet in hopes Trump would lose the 2020 election and they'd get a better deal from the Democrats. Still, four-fifths of economists polled by Bloomberg see a further escalation of tariffs increasing the possibility that the USA economy could slip into recession by the end of next year.

While financial markets expect the Fed to cut interest rates in the next year, Chairman Jerome Powell and his colleagues have indicated they don't see a strong case for a move either way.

Trump has repeatedly criticized the central bank, urging it to deliver a drastic rate cut and resume bond purchases in an April 30 tweet.

The Fed will reiterate a message which has reassured investors and consumers because the start of the season: No rate hikes will likely soon. And with inflation tame, the Fed has been seen as able to stay at least through this season.

Nevertheless Trump insists that the market can do much better, and to that end he's now demanding what no mainstream economist would favor: Cutting on speeds further.

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