What's happening with the US economy

11:27 a.m. ET, August 23, 2019

Trump says he will respond to tariffs this afternoon

The President said he will be responding to the tariffs “this afternoon.”

In a series of tweets, he expresses frustration with China, and says, “Our great American companies are hereby ordered to immediately start looking for an alternative to China.”

Watch for more:

11:04 a.m. ET, August 23, 2019

The Fed chief is facing a no-win situation

Jerome Powell is in a no-win situation because he has to navigate recession fears while trying to please President Donald Trump, says CNN Business' Matt Egan.

10:47 a.m. ET, August 23, 2019

Trump: "Who is our bigger enemy," Powell or China's Xi?

President Trump just aired further grievances against Chairman Jerome Powell, who delivered a speech in Jackson Hole this morning. 

Some context: Trump has been dialing up his demands for the Fed to aggressively cut rates.

He has argued the "economy would be even better" if the Fed lowered rates by at least 100 basis points over time —a move usually reserved only for a serious economic downturn — to help the United States compete against other countries where rates are lower, namely Germany.

11:56 a.m. ET, August 23, 2019

Powell gives no hint about future rate moves

Federal Reserve chairman Jerome Powell acknowledged today that the economy has grown more turbulent in the three weeks since the Fed cut rates for the first time in a decade -- but stopped short of giving any indication about what might be coming at the next rate-setting meeting in September. 

"We are carefully watching developments as we assess their implications for the US outlook and the path of monetary policy," Powell said according to prepared remarks released ahead of an address at an annual economic symposium in Jackson Hole, Wyoming. 

He reinforced his pledge that policymakers will continue to take "appropriate" steps to support the US economy's longest-running expansion amid signs of a slowdown

10:15 a.m. ET, August 23, 2019

Stocks briefly bounce back after Powell's comments

US stocks pared some of their losses on Federal Reserve Chairman Jerome Powell's speech, bouncing back from their session lows.

The Dow briefly flipped into modestly positive territory, while the S&P 500 and Nasdaq Composite stayed in the red.

Stocks opened lower after China announced fresh retaliatory tariffs on American imports.

The US dollar, measured by the ICE US Dollar Index, remained unchanged, 0.1% higher. The 10-year US Treasury yield slipped slightly further at $1.5961%.

10:07 a.m. ET, August 23, 2019

Fed chair acknowledges growing risk of an economic slowdown

Federal Reserve chairman Jerome Powell today acknowledged that the economy has grown more turbulent in the three weeks since the Fed cut rates for the first time in a decade.

However, he stopped short of giving any indication about what might be coming at the next rate-setting meeting in September. 

"We are carefully watching developments as we assess their implications for the US outlook and the path of monetary policy," Powell said, speaking at an annual economic symposium in Jackson Hole, Wyoming.

He reinforced his pledge that policymakers will continue to take "appropriate" steps to support the US economy's longest-running expansion amid signs of a slowdown.

The backdrop of his remarks: They come as Trump has dialed up his demands for the Fed to aggressively cut rates.

Here's what the President tweeted just an hour before Powell was set to take the stage at the economic conference:

In his speech, Powell described the last three weeks since the Fed meet in July as "eventful," running through a list of developments that have shuddered markets:

  • An escalation of tariffs in an ongoing trade war between the US and China
  • the growing possibility of a "hard Brexit," with the UK's departure from the European Union
  • a global slowdown, most notably in Germany and China

In recent months, the Fed has made clear that it is carefully considering trade uncertainty, a global growth slowdown and subdued inflation as it's sought to calibrate the right mix of policy in setting interest rates.

But Powell emphasized to a room of central bankers and economists that there's "no recent precedents" for the Fed to guide how policymakers should account for such trade policy uncertainty.

"Fitting trade uncertainty into this framework is a new challenge," said Powell.

Even in this "challenging era," Powell said, the US economy is in a "favorable place," which he partly attributed to the Fed's decision to cut rates in July for the first time since the financial crisis of 2008. 

9:48 a.m. ET, August 23, 2019

Stocks open lower after China announces retaliatory tariffs

US stocks kicked the day off in the red today after China announced fresh tariffs on $75 billion worth of American imports.

Stock futures had been in the green prior to the announcement, as investors focused on a highly anticipated speech by Federal Reserve Chairman Jerome Powell in Jackson Hole at 10 a.m. ET today.

Shares sensitive to trade, such as Apple (AAPL), Intel (INTC), Caterpillar (CAT) and Nike (NKE), all slipped at the open.

9:47 a.m. ET, August 23, 2019

What Trump wants the Fed to do

Jerome Powell's speech comes as President Trump has dialed up his demands for the Fed to aggressively cut rates.

He has argued the "economy would be even better" if the Fed lowered rates by at least 100 basis points over time —a move usually reserved only for a serious economic downturn — to help the United States compete against other countries where rates are lower, namely Germany.

9:35 a.m. ET, August 23, 2019

Jerome Powell faces his biggest test yet

Federal Reserve Chairman Jerome Powell speaks soon at the annual gathering of central bankers in Jackson Hole, Wyoming. He is facing tremendous political pressure from President Donald Trump, and expectations from many investors, to deliver more rate cuts.

Powell will need to assure markets — which appear to have already assumed another rate cut will come in September — that the Fed will do whatever it can to support the economy amid growing fears of a US slowdown. At the same time, he can't overpromise and risk further turmoil.

Read more here.