Therefore, the threat to the independence and stability of the Federal Reserve is something that will come alive in a major way were the USA economy to start slowing over coming months.
"Downside risks could weigh on US economic activity". China has retaliated on USA products.
And if that happens, the loonie should begin to creep closer to the greenback.
The Australian dollar was a touch higher at $0.6885 following a modest gain of 0.1 per cent on Wednesday.
Bullard earlier this month was to first central banker to give voice to the expectations of financial markets that economic conditions would require the Fed to act, saying a rate cut could be needed "soon".
"Recent indicators of inflation and inflation expectations have been disappointing", Fed Governor Lael Brainard said on Friday in prepared remarks to a Fed conference in Ohio.
On Tuesday, reports emerged that the White House was looking into axing Powell.
Waiting too long means more aggressive Fed action could be required.
Asked directly whether he would step down should the USA president call for his resignation, Powell was equally direct: "I think the law is clear that I have a four-year term and I fully intend to serve it".
U.S. President Donald Trump hinted again this week that he'd like to wave goodbye to the Fed chair he appointed. But Powell said he intends to complete his four-year term, even if formally asked to step down.
St. Louis Fed President James Bullard, who had argued that rates should be cut, dissented in Wednesday's policy decision to hold rates steady.
The long-run federal funds rate, a barometer for the state of the USA economy over the long term, was indeed cut to 2.5 percent from 2.8 percent.
Powell did confess to being anxious that conditions were about to change.
The closely scrutinised post-meeting statement by the United States central bank dropped a reference to being "patient" with its policy course, and added that "uncertainties" about the outlook for the U.S. economy "have increased".
Despite Powell's apparent optimism, markets refused to listen.
The news put further pressure on the Dollar, with markets now having to seriously contend with the prospect of managerial instability at one of the world's most important financial institutions. He warned of "crosscurrents" - a meteorological euphemism for economic threats, similar to Poloz's "headwinds".
"The main question is no longer if the Fed will cut rates in July, but whether the easing will be by 25 or 50 basis points". That would narrow the gap between Canadian and USA rates, nudging the loonie higher. Trade tensions have heightened uncertainty among companies, investors and foreign leaders and may be weighing on business investment. Mnuchin is otherwise in good standing with the president, they said.
According to reporter Jennifer Jacobs at Bloomberg, Trump told confidants as recently as Wednesday that he believes he has the authority to replace Jerome Powell as chairman of the Federal Reserve Board. Instead, he said, the goal was to "sustain the expansion" so that it could reach out into parts of the economy that had not yet felt its effects.
Fed should commit to not raising interest rates until inflation is sustainably at 2%.
In Canada, despite repeated gloomy warnings about a future housing slump, the latest economic signals remain strong.