That step eased fears that Trump would extend punitive tariffs to an additional $300 billion in Chinese goods, in the process inviting retaliation from Beijing on American exports and likely weakening both nations' economies.
Asian shares turned mixed on Wednesday while rising Treasury yields lifted the dollar as markets wondered if the world's most powerful central banker would confirm or confound expectations for U.S. policy easing this month.
The market held onto expectations that policymakers will lower the benchmark interest rate by 25 basis points.
"Nothing will distract us from complete focus on our job". Trump wrote on Twitter earlier this month, the latest in a series of unprecedented attacks on the independence of the Fed by a sitting president. But he noted that "crosscurrents, such as trade tensions and concerns about global growth, have been weighing on economic activity and the outlook".
The statement released after the last meeting also cited rising "uncertainties" and "muted" inflation in its shift toward a rate-cutting bias last month.
Powell and James Bullard, who was the only dissenting vote in favour of a rate cut at the Fed's meeting in June, are scheduled to address events this week, potentially providing some clue on the policy makers' next move. -China trade war and agreed to resume talks toward a deal that would meet the administration's demands to better protect USA technology.More news: Sir John Major has threatened to block Boris's Brexit plans
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"Apparent progress on trade turned to greater uncertainty, and our contacts in business and agriculture reported heightened concerns over trade developments". The president has been Powell's harshest critic, and in recent days hinted about his authority to demote or fire him. The Fed has raised rates nine times since 2015, four increases coming under Powell's leadership.
"I guess chairman Powell feels there is more downside risk to the economy and the Fed needs to accommodate that", said Kim Forrest, chief investment officer at Bokeh Capital Partners. "Pack up. It's time to go'".
"I hope everyone heard that."The president also said on Sunday that the Federal Reserve would cut interest rates if it "knew what it was doing".
In reaction to the dovish commentary, the Dollars dropped across the board alongside U.S. treasury yields, while gold jumped back about $1400 with USA equities also surging as Fed Chair Powell sets the stage for incoming rate cuts.
- CBS News' Irina Ivanova contributed reporting.