Jerome H. Powell, the chair of the Federal Reserve, refrained from giving a definitive signal on the timeline for cutting interest rates during his speech at the Economic Club of Washington. He welcomed the recent moderation in inflation but maintained a neutral stance.
Despite consecutive reports showing a decline in inflation, Powell chose not to hint at when the central bank might initiate interest rate cuts. This cautious approach came in the wake of growing expectations among economists that a rate cut could be imminent.
Goldman Sachs economists suggested in a recent note that a rate cut in the upcoming meeting this month could be justified given the significant decrease in inflation. However, Powell’s remarks did not hint at an earlier rate cut, leaving the timing uncertain.
While Powell acknowledged the recent inflation data supporting the view that price increases are easing, he refrained from providing a clear signal on when the Federal Reserve would be sufficiently confident to reduce borrowing costs.
