Markets have received important clues about the US Federal Reserve’s future monetary policy. Fed Chairman Jerome Powell has signaled the need for a long-awaited interest rate cut. After keeping interest rates elevated for so long, the regulator has finally uttered the magic phrase, "the time has come."
Speaking at the Fed's annual economic symposium in Jackson Hole, Powell endorsed an imminent start to interest rate cuts. "The time has come for policy to adjust," he said, adding that the timing and pace of rate cuts would "depend on incoming data, the evolving outlook, and the balance of risks."
Powell also highlighted cooling in labor market conditions, stating that the US central bank would make every effort to "support a strong labor market" while making further progress toward price stability.
The Federal Reserve is widely expected to cut interest rates for the first time since 2020 at its upcoming meeting scheduled for September 17-18.