Powell affirms patience on Fed rate cuts

US FEDERAL RESERVE Chair Jerome Powell told lawmakers on Tuesday the argument for free trade still makes sense but added that it was not the role of the central bank to comment on tariff or trade policy but to react to how it impacts the economy.

- HOWARD SCHNEIDER

"The standard case for free trade...logically still makes sense," Powell said in response to questioning at a hearing before the Senate Banking Committee. But "it's not the Fed's job to make or comment on tariff policy...Ours is to try to react to it in a thoughtful, sensible way."

Powell spoke as the Trump administration begins rolling out import taxes on different countries and commodities, adding a fresh dose of uncertainty to the Fed's battle against inflation that remains more than half a percentage point above the Fed's 2% target.