Fed's Powell says he sees no broad threats from commercial real estate lending

Federal Reserve Chairman Jerome Powell said on Wednesday that commercial real estate lending remains under pressure but appears unlikely to threaten the broader financial system.

Powell, speaking at his press conference following the close of the rate-setting Federal Open Market Committee meeting, said the Fed is closely watching commercial real estate risks and expects to see losses. But he added these types of loans are broadly spread through the financial system and are often held by smaller banks, reducing the risk of system-wide trouble. Challenges in this sector "feels like something that will be around for some time," Powell said.