Powell says he would not resign if Trump asked him to

Powell says he would not resign if Trump asked him to

The president also told the Washington Post he was "not even a little bit happy with my selection of Jay" - adding that the Fed was a bigger threat to the U.S. economy than his trade war with China. "And particularly with muted inflation readings that we've seen coming in, we will be patient as we watch to see how the economy evolves".

The index gave away part of the post-Payrolls gains to the 96.60 region as market participants continue to gauge the speech by Fed's Jerome Powell.

U.S. Federal Reserve Chairman Jerome Powell speaks at the American Economic Association/Allied Social Science Association (ASSA) 2019 meeting in Atlanta, Georgia, U.S., January 4, 2019.

As of 12:34 pm ET, the Dow had risen 705.98 points or 3.11 percent in the hours since Friday's opening bell, carrying the index to 23,392.20.

The Fed chairman, responding to a question about what he would do if Trump asked him to step down, said he would not resign. Under the law that governs the Federal Reserve, a president can only remove a Fed chairman for cause. Alongside past Fed chairs Janet Yellen and Ben Bernanke, Powell reiterated much of what he has said in the past few months concerning monetary policy.

Powell's willingness to be flexible on interest rates was welcome news to investors, many of whom anxious that Fed chair risked cutting off the current economic expansion by continuing to raise interest rates despite signs the USA economy was cooling off a little.

Although still low by historical standards, this latest hike put interest rates at the highest level in almost a decade.

US stocks were pummelled on Thursday after Apple slashed its revenue forecast due to weak demand in China and a report showed US manufacturing activity slumping to a two-year low, reviving fears about a global economic slowdown in the wake of the US-China trade war.

"It is incredible that with a very strong dollar and virtually no inflation, the outside world blowing up around us, Paris is burning and China way down, the Fed is even considering yet another interest rate hike".

Compared to comments he made after the Fed raised rates last month, "it's not that he's changed his message ... but that he explained it more patiently and in greater detail", said Lou Brien, market strategist at DRW Trading in Chicago. But it has been gradually reversing that stance over the past year, although the balance sheet still remains above $4 trillion.

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