Fed chairman says U.S. economy healthy, but warns about volatility

Feb. 26 (UPI) -- In testimony before a Senate committee Tuesday, Federal Reserve Chairman Jerome Powell touted a "healthy" U.S. economy but warned volatility could slow financial growth by the end of the year.

Powell delivered his semiannual Monetary Policy Report to the Senate banking committee Tuesday. He told the panel he would "carefully monitor" ongoing Brexit negotiations and the Trump administration's trade deal with China.

"While we view current economic conditions as healthy and the economic outlook as favorable, over the past few months we have seen some crosscurrents and conflicting signals," Powell said. "Financial markets became more volatile toward year-end, and financial conditions are now less supportive of growth than they were earlier last year."

Sen. Elizabeth Warren, D-Mass., asked if the Federal Reserve would rubber stamp the proposed merger between SunTrust and BB&T. Powell pledged a fair and transparent process, but Warren was skeptical, citing the merger history of the Trump administration.

Powell also faced questions about the Fed's outlook and moves that some analysts consider missteps since he took over for Janet Yellen a year ago. On those occasions, Powell's remarks have had a significant impact on U.S. markets.

As Federal Reserve chief, Powell has raised interest rates four times, moves that some analysts say weighed down the U.S. economy. The Fed left interest rates alone at its policy meeting last month and will meet again March 19 and 20.

Powell is scheduled to testify before the House financial services committee Wednesday.