US Federal Reserve Chairman Jerome Powell said that a rate cut by the Fed could be on the table as early as September.
Powell indicated that the interest rate cut is contingent on the Federal Reserve receiving positive results for the US economic data that would allow it to move to cut interest rates.
The Federal Reserve kept interest rates unchanged on Wednesday, but the Fed chairman said at a news conference that a rate cut was imminent.
The Fed Chairman said: The broad meaning of the Fed's monetary policy committee is that the economy is approaching the point at which it is appropriate to lower our interest rates.
“The question will be whether the aggregate of data, evolving expectations and the balance of risks are consistent with rising confidence in lower inflation and a strong labor market,” Powell said.
He added: If this test is met, then our interest rate cut could be on the table as soon as possible at the next meeting in September.
Powell said the US central bank is closely monitoring the labor market and will remain vigilant for signs of a potential sharp slowdown.
At this point, the low unemployment rate and the low level of layoffs indicate that the labor market is returning to normal, he said during the press conference on Wednesday.
