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Federal Reserve Chairman Jerome Powell.

Federal Reserve Chair Jerome Powell said Tuesday that "uncertainties about the outlook have increased," hewing to comments that have led many investors to conclude that the central bank is moving toward cutting interest rates later this month.

Powell, in prepared remarks for a speech in Paris, said the economy remains "solid" and that labor markets were expected to remain "solid." The U.S. unemployment rate currently stands at 3.7%, close to the lowest in a half century. 

But he noted concern regarding "trade developments and global growth." Investors have fretted that President Donald Trump's trade war with China is causing such anxiety among U.S. businesses that they're slowing the rate of investment in new factories, equipment, technology and personnel -- which could ultimately lead to slower economic growth. 

"We are carefully monitoring these developments and assessing their implications for the U.S. economic outlook and inflation, and will act as appropriate to sustain the expansion," Powell said, 

A rate reduction, from the current range between 2.25% and 2.5%, would be the first since before the 2008 financial crisis.

The Fed held the rate close to zero for years after the crisis to help markets and the economy heal, but the central bank's monetary-policy committee started raising them in 2015. 

After a market swoon last year that brought condemnation of Powell's leadership from President Donald Trump, the Fed reversed course and said it would stop raising rates, pronouncing that monetary policy "normalization" was complete.

And then in recent months, the Fed has signaled an openness to cutting interest rates, by at least 0.25 percentage point, at a meeting scheduled for July 30-31.