Fed's Powell: U.S. economy 'resilient' but coronavirus a risk

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SOUNDBITE (ENGLISH) FEDERAL RESERVER CHAIRMAN JEROME POWELL, SAYING:

"We are closely monitoring the emergence of the coronavirus, which could lead to disruptions in China that spill over to the rest of the global economy."

In his first public testimony since the outbreak of the coronavirus brought the world's second largest economy to a standstill , U.S. Federal Reserve Chairman Jerome Powell Tuesday said the Fed is standing watch for any possible impact.

SOUNDBITE (ENGLISH) FEDERAL RESERVER CHAIRMAN JEROME POWELL, SAYING:

"I think we know there will be effects on China through the first half of the year and China's close neighbors and major trading partners in Europe as well as Asia; and we know that there will likely be some effect on the United States. I just think it is still to early to say. We have to resist the temptation to speculate on this. So, we will be watching that carefully and again the question we will be asking is: Will these be persistent effects that could lead to a material reassessment of the outlook?"

In remarks delivered to House lawmakers Tuesday, in day one of his twice-a-year economic update to Congress, Powell warned if economic conditions deteriorate enough to threaten the U.S. economy, with interest rates already low, the Fed won't be able to rely on cutting rates deep enough to provide support.

But for now this economy is humming along.

SOUNDBITE (ENGLISH) FEDERAL RESERVER CHAIRMAN JEROME POWELL, SAYING:

"Over the second half of last year economic activity has increased at a moderate pace and the labor market strengthened further as the economy appeared resilient to the global headwinds that had intensified last summer. Employers are increasingly willing to hire workers with fewer skills and train them, as a result the benefits of a strong labor market have become more widely shared."

But that didn't stop his long-time critic, President Trump from once again calling for lower rates - NOW.

As Powell was testifying, Trump tweeted: "When Jerome Powell started his testimony today, the Dow was up 125.. As he spoke it drifted steadily downward, as usual... other countries get paid to borrow money. We are more prime, but Fed Rate is too high, Dollar tough on exports."

When asked about the tweet, Powell declined to respond.

He'll be back on Capitol Hill Wednesday to testify before the Senate.