MNI TRANSCRIPT: Powell on Trade Policy and Business Investment

     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: Mid-February the phase 1 China deal goes into effect. Have you seen

business investment pick up at all? If not, what will it take to get that

business investment going as this uncertainty is being cleared up?

     A: Yeah, so I guess I'd start by saying that the fact that we've reached a

Phase 1 deal with China and the fact that we've moved ahead closer to getting

USMA agreed, those are potentially positive things for the economy, without

question, without question. And financial markets, the reaction of financial

markets is very consistent with that perception. A sustained reduction in

uncertainty over time should improve business sentiment and investment which

would provide additional support for the economy. It's important though to bear

in mind a couple of things. First, trade policy uncertainty remains elevated.

Businesses continue to identify it as an ongoing risk. We still have two or even

three active trade discussions that are going on in the public square right now,

so it hasn't gone away and we've just come through a round of talking to our

vast network of comments -- I'm sorry, of contacts in the business world and I

think clearly these are seen as positive developments going forward but there is

a bit of a wait and see attitude. Is this going to be sustained? The agreements

have to be implemented too and that will take quite some time, so I would say we

need to be a little bit patient about the effect on the economy. There is also

the global economy. You could well see manufacturing, as I mentioned,

manufacturing PMIs have started to tick up consistently in advanced economies

and emerging economy, and we do not see a decisive recovery, but it's possible

the mix of positive developments and accommodated financial conditions could

spur further growth.

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

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