Fed Chair Powell says Chinese and European economies have slowed 'substantially'

Weakening Chinese and European economies are acting as a deterrent to U.S. growth, Federal Reserve Chairman Jerome Powell said Wednesday.

Speaking just after the central bank decided to hold the line on interest rates this week and likely maintain that stance through the year, Powell said that an otherwise strong domestic picture is getting dented from abroad.

"Now we see a situation where the European economy has slowed substantially and so has the Chinese economy, although the European economy more," he said in response to a question from CNBC's Steve Liesman. "Just as strong global growth was a tailwind, weaker global growth can be a headwind to our economy."

This is a developing story. Please check back here for updates.

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