Powell talks about negative impacts on US economy, signals rate cut

Federal Reserve Chairman Jerome Powell said in statements prepared in advance to testify before the Financial Services Committee of the US House of Representatives, that there are many factors that negatively affect the largest economy in the world.

"The US-China trade dispute is the most important factor that has a negative effect and is putting a strong pressure on the US economy," Powell said.

He added that this coincides with signs of a slowing global economic growth, and therefore, its US counterpart is affected by dependence, as he also said that the continued weakness in inflation is more risky than previously expected, which may support a shift towards a rate cut.

Despite the strength of the US labor market and the positive performance of the economy, these remarks were seen by observers as a strong signal that the US central bank is moving towards a rate cut at this month's meeting.