Global Slowdown

By Isaac Cohen*


President Donald Trump should be pleased with the decision by the Federal Reserve to leave interest rates unchanged, but he may be less pleased, given the reasons which led to the decision. According to the statement issued last week, at the close of the Open Market Committee meeting, in the United States “growth of economic activity has slowed from its solid rate in the fourth quarter.” HYPERLINK “https://www.federalreserve.gov/monetarypolicy/files/monetary20190320a1.pdf”


At the end of meeting press conference, Federal Reserve Chairman Jerome Powell highlighted “a positive outlook for this year” in the US economy, with increasing salaries and low unemployment. However, he also described some risks, such as slow growth in China, Europe and Japan, together with uncertainties derived from trade tensions between China and the United States. On future interest rate changes, Chairman Powell said, “We are going to watch carefully and patiently as we allow events to evolve.” He had previously defined “patience” as “we don’t feel any hurry to change our interest rate policy.”


Still, by the end of last week global markets closed sliding, on account of a March drop in euro zone manufacturing activity, while US manufacturing fell to its lowest level in two years. Therefore, there is expectation about the release of first quarter growth figures in Europe and Canada, and revised figures in the United States. Meanwhile, on March 22, the Federal Reserve Bank of Atlanta GDPNow model estimate for real GDP growth in the first quarter of 2019 is 1.2 percent, up from 0.4 percent estimated on March 13.

*International analyst and consultant, former Director ECLAC Washington. Commentator on economic and financial issues for CNN en Español TV and radio, UNIVISION, TELEMUNDO and other media.

About Ramón Jiménez

Ramón Jiménez, Managing Editor de MetroLatinoUSA.Com (MLN). Graduado de la Escuela de Periodismo de la Universidad del Distrito de Columbia (UDC). Email: [email protected]

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