Federal Reserve Chair Jerome Powell signaled the central bank is leaning toward cutting interest rates at its September 17th meeting, citing growing risks from a weakening labor market and persistent inflation pressures. Speaking at the annual Jackson Hole economic forum, Powell said the Fed will “proceed carefully” but noted that the balance of risks may now justify a policy shift. His remarks boosted Wall Street, with the S&P 500 rising 1.3%. Economists widely interpreted his comments as a clear pivot toward rate cuts, following disappointing job growth data and downward revisions to prior employment reports. While Powell acknowledged that inflation remains above target and could be further elevated by President Trump’s tariffs, he also noted it may only cause a one-time pricing increase. Powell also emphasized that the Fed’s dual mandate requires addressing both inflation and employment risks. Market expectations for a September cut rose to about 72% ahead of the meeting.
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By: Jon Iacono