Fed Chair Powell: The ‘time is coming’ for a rate cut

Federal Reserve Chair Jerome Powell said the time is coming for interest rate cuts, but asked Americans for a bit more patience in the central bank’s fight against inflation.

Federal Reserve Chair Jerome Powell said the time is coming for interest rate cuts, but asked Americans for a bit more patience in the central bank’s fight against inflation. The US economy is strong and the central bank will likely lower later interest rates later this year, he said, but it’s just “not likely” to happen this March, as Wall Street once expected it to. “We’ve said that we want to be more confident that inflation is moving down to (the Fed’s target rate of) 2%,” Powell said in an interview that aired Sunday on CBS’ “60 Minutes.” “I think it’s not likely that this committee will reach that level of confidence in time for the March meeting, which is in seven weeks.” Powell last appeared on the program in April 2021, about 11 months before the central bank began a two-year regimen of aggressive interest rate hikes to fight accelerating inflation rates. The Fed’s benchmark lending rate is currently at a 23-year high, but a policy pivot appears imminent. The Fed held interest rates steady last week for its fourth-straight policy meeting and rate cuts are expected sometime this year. Price hikes have eased substantially in recent months, inching closer to the Fed’s 2% target. That means the Fed is due to cut rates in 2024, which officials themselves projected in December. But the central bank’s January policy statement pushed back on expectations of the first rate cut coming at their next meeting in March.