Powell Says Fed Can Wait for Clearer Signs of Cooling Inflation Before Cutting Rates

Federal Reserve Chair Jerome Powell said the central bank is in no hurry to cut interest rates, arguing that policymakers are well positioned to wait for clearer evidence that inflation is moving sustainably lower. In remarks that underscored the Fed’s cautious stance, Powell pointed to persistent price pressures and a labor market that remains resilient as reasons to keep policy restrictive for now.

Powell’s comments suggest the Fed wants more confirmation that inflation is on a durable downward path before easing borrowing costs. While recent data have shown some moderation from peak levels, officials remain wary of declaring victory too soon, especially with services inflation and wage growth still proving sticky.

The message reinforced expectations that rates will stay elevated in the near term, even as investors continue to look for clues on when the first cut might arrive. Markets reacted modestly to the remarks, with U.S. stock futures slipping slightly and the dollar strengthening against major currencies.

The Fed has kept rates at a 23-year high as it seeks to balance the risk of reigniting inflation against the possibility of slowing economic growth too much. Powell’s latest comments indicate that, for now, the central bank sees little urgency to move before the inflation outlook becomes clearer.