Powell says he would reject any request from Trump to resign

US Dollar Index turns negative on dovish Powell

US Dollar Index turns negative on dovish Powell

In a session emblematic of the elevated volatility that has gripped markets for weeks, all three major USA stock indexes surged more than 3 percent in one of the broadest advances in years.

He added that the United States central bank would not hesitate to adjust its balance sheet reduction plan if it causes problems in the markets.

The Labor Department reported on Friday that 312,000 jobs were created last month, well above market expectations. "Some years ago, we decided that rate policy was going to be the active policy tool and the balance sheet would be allowed to shrink gradually and predictably in the background", he said.

"Obviously the president has the right to comment on the Fed", Yellen said.

Powell said the Fed is not on a preset path of interest rate hikes and suggested that it could pause its policy tightening as it did in 2016.

At the conference on Friday, Mr Powell said he has not spoken directly to Mr Trump and would not resign if asked.

The recent market turbulence has posed a dilemma for the Fed, as a seeming loss of confidence in financial markets about the US economy's prospects was offset by upbeat data from the real economy, including a strong December jobs report.

"I would say that meetings between presidents and Fed chairs do happen", was Powell's answer when asked if he would meet with Trump.

Economic momentum in the USA remains solid, Powell said just hours after a monthly U.S.jobs report suggested the economy remains strong.

On the economic front, stronger-than-expected employment data helped regain steam for the U.S. economy.

The U.S. central bank hiked interest rates four times last year, including in December when policymakers' forecasts pointed to two more rises this year.

China's Commerce Ministry said trade talks will be held Monday and Tuesday in Beijing, and investors will again look for signs the world's largest economic powers are resolving their dispute.

"While days like today feel good, we still anticipate more economic weakness ahead and expect a continued back-and-forth grind in markets", said Eric Freedman, chief investment officer at U.S. Bank Wealth Management in Minneapolis. I think the next couple of sessions will probably be bullish, but I'm looking to sell closer to the 2600 level.

"You do have this difference between, on the one hand, strong data, and some tension between financial markets that are signaling concern and downside risks, " he said.

Powell added that they will be "listening carefully" to financial markets and "will be prepared to adjust policy quickly and flexibility and use all of our tools to support the economy should that be appropriate".

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