US economy will not be as strong in 2019 as it was in 2018: JPMorgan Chase chief economist
Economists now echoing the Federal Reserve's concerns about slowing economic growth after the central bank announced Wednesday interest rates would be left unchanged in 2019.
Federal Reserve Chairman Jerome Powell told reporters Wednesday the Fed has been seeing signs since December that economic growth abroad is slowing more than expected, and he said U.S. economic data have been mixed so far this year.
“The U.S. economy is in a good place and we will use our monetary policy tools to keep it there,” Fed Chairman Jerome Powell said.
But JPMorgan Chase chief economist Anthony Chan told FOX Business he is predicting the U.S. economy may not be as strong in 2019 compared to 2018 given some weakness in economic forces.
“Last year, we grew at 2.9 percent...as we go into 2019, we are probably going to get a number that is closer to 2 percent than it is to 3 percent,” Chang told FOX Business’ Neil Cavuto on Wednesday.
He said this loss of momentum is the main reason behind the Federal Reserve stressing patience in raising interest rates. Chang sees the Federal Reserve normalizing their balance sheet “sooner rather than later.”
Rate forecasts released after the Federal Reserve's two-day policy meeting this week showed 11 of the 17 Fed officials who affect interest-rate policy didn’t think the central bank would need to raise interest rates at all this year, up from two officials in December. The other six officials projected a 1-2 rate increase would be needed in 2019.
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The Federal Reserve had raised its benchmark rate four times in 2018, most recently in December, to a range between 2.25 percent and 2.5 percent. At that meeting, most Fed officials had projected between 1-3 rate increases for 2019.
Powell also told reporters inflation is “clearly” not meeting the Fed's target. He also said the Federal Reserve has not decided on the mix of short- and long-term Treasury securities in its portfolio.