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BUSINESS Friday 13 december 2019
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Fed leaves low rates alone and foresees no moves in 2020

By CHRISTOPHER RUGABER more Americans have bor-
Associated Press rowed to buy cars.
WASHINGTON (AP) — The After having raised its
Federal Reserve is leaving benchmark short-term rate
its benchmark interest rate four times in 2018, the Fed
alone and signaling that it reversed course this year
expects to keep low rates and cut rates three times
unchanged through next to a range of 1.5% to 1.75%.
year. Powell has portrayed those
The Fed’s decision follows cuts as mainly “insurance”
three rate cuts earlier this against a slowdown re-
year. It reflects its view that sulting from weak global
the U.S. economy has so growth and President Don-
far withstood the U.S.-Chi- ald Trump’s prolonged
na trade war and a global trade war with China.
slump and remains gener- Monthly job growth
ally healthy. reached its highest point
Its benchmark rate — which this year in November, and
influences many consumer the unemployment rate
and business loans — will matched a 50-year low of
remain in a low range of 3.5%. Measures of consum-
1.5% to 1.75%. The Fed may er confidence also remain
prefer to leave rates alone at historically high levels.
through 2020, an election In this Nov. 25, 2019, file photo Federal Reserve Board Chair Jerome Powell addresses a round Powell and other Fed
year. But many analysts table discussion during a visit to Silver Lane Elementary School, in East Hartford, Conn. policymakers have made
note that the economy Associated Press clear that they are no lon-
faces risks from trade con- ger worried that a healthy
flicts, a global slowdown ment has led many Fed ers and businesses afford Chairman Jerome Pow- job market will necessar-
and a potentially disruptive officials to conclude that to borrow and spend. Still, ell has said that this year’s ily fuel excessive inflation.
Brexit and say the Fed may rates can remain lower savers have struggled to Fed rate cuts have helped Instead, they would like to
feel compelled to cut rates for much longer than they find returns outside the lower mortgage rates and see inflation reach their 2%
at least once next year. thought without spurring stock market that can spurred growth in home target level after running
Persistently low inflation higher prices. keep them ahead of infla- purchases. Auto sales have below it for most of the
with very low unemploy- Low rates help consum- tion. also remained healthy as past seven years. q
US stocks rise in early trading on trade deal hopes

By DAMIAN J. TROISE 1.79% late Wednesday. CASH REGISTERS RINGING?
Associated Press Technology companies also Friday’s retail sales report
NEW YORK (AP) — Stocks made strong gains. Broad- from the Commerce De-
moved higher in early trad- com rose 2.5%. partment will offer inves-
ing on Wall Street Thursday Real estate companies and tors a solid measure of the
as investors jumped on a utilities lagged the market in economy’s health in a week
statement from President another sign that investors dominated by uncertainties
Donald Trump that the U.S. is were shifting money away over trade. Economists ex-
getting close to a “big deal” from safe-play investments. pect retail sales to rise in No-
with China. KEEPING SCORE: The S&P vember. q
Wall Street has been watch- 500 index rose 0.6% as of 10
ing closely for any develop- a.m. Eastern time. The Dow
ments in the ongoing trade Jones Industrial Average 173
negotiations all week as the points, or 0.6%, to 28,084.
nations head for another The Nasdaq rose 0.5%. The
escalation. A new round of Russell 2000 index of smaller In this Dec. 5, 2019, file photo, trader Gregory Rowe, left, and
U.S. tariffs on Chinese goods company stocks rose 0.6%. specialist Michael Pistillo work on the floor of the New York
will kick in on Sunday and TAKEOFF: Delta Air Lines rose Stock Exchange.
raise the prices of popular 3.8% after the most profit- Associated Press
products including laptops able U.S. carrier gave inves-
and cellphones. Investors tors a surprisingly good profit
are hoping that enough and revenue forecast for
progress is made to prompt 2020. The company said it
a delay from Washington. expects sustained demand
Banks helped lead the gains for air travel and stable pric-
as bond prices fell, sending es for jet fuel.
yields higher. Bank of Amer- SPREADING LUV: Southwest
ica rose 1.5%. Higher yields Airlines 1.8% after it reached
allow banks to charge more a deal with Boeing for com-
lucrative interest rates on pensation over the ground-
mortgages and other loans. ing of the 737 Max aircraft.
The yield on the 10-year It will also share about $125
Treasury rose to 1.84% from million with its workers.