When Jay Powell stepped up to the podium at the Federal Reserve Bank of Chicago earlier this month, he delivered what in Fed-speak amounted to a thunderbolt. Talking about the impact of “trade negotiations” between the US and China, the Fed chairman said: “We are closely monitoring the implications of these developments for the US economic outlook and, as always, we will act as appropriate to sustain the expansion.”

After the Fed spent the past three-and-a-half years normalising interest rates after the vast monetary stimulus of the post-crisis decade, Mr Powell, who has been in the job since last February, was pointing to a possible reverse of course.

Financial Times