Jerome Powell Insists Trump Victory Won't Impact Fed's Decision-making

While announcing a 0.25% interest rate cut on Thursday, Federal Reserve chair Jerome Powell made it clear that the outcome of the presidential election will not affect the US central bank's monetary policy actions.

Powell announced the quarter-percent interest rate cut that, along with Donald Trump's election victory, has sent stock markets soaring. When asked about how the volatility of various financial markets and how Trump's win will effect the Fed, Powell spoke candidly.

"Let me say in the near term, the Fed -- the election have no effects on our policy decisions," Powell said in a live broadcast on C-SPAN. "Here, we don't know what the timing and substance of any policy changes will be.

"As you know, many things affect the economy and anyone who writes down forecasts in their job will tell you the economy is quite difficult to forecast looking past the very near term."

Powell said the Federal Reserve's two goals for monetary policy are "maximum employment and stable prices." He added that the latest rate cut was made with those goals in mind.

"We remain committed to supporting maximum employment bringing inflation sustainably to our 2% goal and keeping longer-term inflation expectations well anchored," he said.

"Today, the FOMC decided to take another step in reducing the degree of policy restraint by lowering our policy interest rate by a 0.25 point."

He said the Fed is "confident" in the "recalibration" efforts for the nation's monetary policy actions. "Strength in the economy and labor market can be maintained with inflation living sustainably down to 2%," he said.

Powell also discussed the labor market's path to stability -- a low employment rate of 4.1%; inflation easing to near 2% compared to where it was two years ago, and lowering the benchmark interest rate by 0.25%. It was the second rate cut this year as the Fed reverses last year's hikes.

According to Powell, the economy and job growth "are in a very good place."

"The economy is strong overall and has made significant progress toward our goals over the past two years," he said. "We are committed to maintaining our economy's strength by supporting maximum employment and returning inflation to our 2% goal."

Powell said the labor market remained solid, averaging 104,000 per month over the past three months, and attributed a slight decline to the "effects of labor strikes and hurricanes on employment in October."

He also said he needs to see more data before he can make a clear decision or comment about the 10-year-yield on the United States Treasury bond note.

"We therefore don't know what the effects on the economy would be specifically whether and to what extent those policies would better for the achievement of our goals variables maximum employment and price stability," Powell said. "We don't guess. We don't speculate. We don't assume."

He said the next scheduled meeting in December will give more insight into the labor market and inflation.