After more than a year of pleas from Wall Street, Federal Reserve Chair Jerome Powell has finally indicated that he will begin cutting interest rates. In a highly anticipated keynote address at an annual symposium in Jackson Hole, Wyo., on Friday, Powell said that his confidence that inflation is returning to the Fed’s 2% target has grown, and there is no longer a reason to keep rates elevated to fight it.
“The time has come for policy to adjust,” he said, noting that “the upside risks to inflation have diminished and the downside risks to employment have increased.”
Powell’s comments come after inflation fell to a three-year low of 2.9% in July, and the unemployment rate rose to 4.3%, triggering a key recession indicator called the Sahm Rule.
