Federal Reserve Chair Jerome Powell on Friday indicated that lowering a key interest rate may be a possibility in the coming months, the Associated Press reports.
Powell gave no hint on timing, however, signaling caution in how the central bank will proceed as it evaluates the impact of tariffs on the U.S. economy.
In a high-profile speech today, Powell highlighted risks like rising unemployment and stubbornly higher inflation that place the Fed in a difficult position. It would typically cut its short-term rate to boost hiring, but keep it high to fight inflation.
“The stability of the unemployment rate and other labor market measures allows us to proceed carefully as we consider changes to our policy stance,” Powell said in prepared remarks. “Nonetheless, with policy in restrictive territory, the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance.”
