MNI TRANSCRIPT: Powell on Fed Reaction To Global Markets

     WASHINGTON (MNI) - The following is the portion of a transcript from

Federal Reserve Chairman Jerome Powell's press conference after the FOMC meeting

Wednesday:

     Q:  Trading since this statement was released shows that investors still

think another rate cut is coming this year.  On their behalf, let me ask, what

is going to guide fed policy to either pull them towards where the dot plot

suggests no more moves this year or... keep them in place?  Are you reacting to

data now?  Are you reacting to your gut feeling about what trade tweaks might

mean?  Should they just watch for J Powell's speeches to decide what's going to

happen going forward?  What's The Fed's reaction function now? 

     A:  Right... so... what we are looking for, through all of the data, all of

the events that are going on around the world, we'll be looking at, you know...

the evolving geopolitical events.  We'll be looking at global growth, trade

policy uncertainty -- most importantly, looking at the performance of the U.S.

economy.  We'll be looking for the things that are affecting the outlook for the

U.S. economy, particularly... the outlook as it relates to maximum employment

and stable prices.  All of those things, in principle, can affect the

achievement of our goals.  

   It's an unusual situation, because... the U.S. economy, itself, the largest

part of it, the consumer part of it, is in strong shape.  The manufacturing

part, less-so, but... overall, you see an economy that, I think, generally

forecasts show growth similar to our own forecasts coming at about 2%, which is

a good solid year. 

   The difference here, we have significant, really, risks to that outlook from

not just the geopolitical events, but also, from slowing global growth and trade

policy, certainly, we'll be looking at all of that and... also, financial market

conditions and how they are affecting the outlook. 

   I can't, it is a -- it's a challenging time, I admit it, but... we really

have to be open to all those things.  We're not on a preset course, we're going

to be making decisions meeting by meeting as we see this and we'll try to be as

transparent as we can, as we go. 

--MNI Washington Bureau; +1 202 371 2121; email: alexandra.kelley@marketnews.com

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