Powell signals possible rate cut in September at Jackson Hole

Federal Reserve Chair Jerome Powell on Friday at the central bank’s annual Jackson Hole economic symposium in Wyoming signaled that the Fed may move toward lowering interest rates in the coming months while stressing that any decision will be cautious and data driven. Speaking to a crowd of central bankers, academics and market participants, Powell said the balance of risks between inflation and a cooling labor market has shifted enough that "the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance," without committing to a timetable for a cut ahead of the Federal Open Market Committee’s Sept. 16–17 meeting.

Powell framed the Fed’s dilemma in stark terms, saying that in the near term "risks to inflation are tilted to the upside, and risks to employment to the downside." He noted recent evidence that tariffs are lifting prices and will continue to filter through the economy, but added that a reasonable base case is that the effect could be "relatively short lived a one‑time shift in the price level." "Come what may, we will not allow a one‑time increase in the price level to become an ongoing inflation problem," he said, underscoring the...