Federal Reserve press conference, 2019-12-11 — Chair Jerome Powell

Question (Christopher Rugaber, Associated Press): Well, just to follow real quick, on the material—material reassessment aspect, are you worried that that has set too high a bar for potential cuts next year? We were talking about rate hikes, but no—no Fed policymaker seems to foresee any cuts next year. Some economists do. Does a material reassessment mean you need to see data actually worsen? Does it reduce your ability to act preemptively the way, arguably, you did this year?
Answer: So, I mean, one thing that we’re mindful of is that we’ve cut rates three times since July. That’s 75 basis points’ worth of cuts. And we do believe that monetary policy operates with long and variable lags, and that it will take some time before the full effects of those actions are seen in the economy. So that’ll take some time. So that’s one reason to hold back and—and wait. And we thought—I think we took strong measures. In fact, if you look at—more broadly at the Treasury yield curve, it has moved more than 75 basis points. So you’ve—you’ve had quite a significant move in the direction of higher accommodation. In terms of what’s—you know, what is material at the end of the day, well, I would just say, whether or not a change in the outlook merits a policy response will be a collective judgment of the FOMC. There isn’t any single factor that will determine our decisions. We’ll— we’ll look at a full range of data and other information bearing on the economic outlook.