Powell says inflation data is encouraging but Fed still wants more proof before a rate cut

Federal Reserve Chair Jerome Powell said the latest inflation figures are moving in the right direction, but not enough to justify an interest-rate cut yet. He described recent readings as encouraging while stressing that policymakers want more confirmation that price pressures are cooling.

Powell’s remarks suggest the central bank is still taking a cautious approach as it weighs when to ease borrowing costs. Even with signs of progress on inflation, officials appear unwilling to move too quickly and risk reversing that trend.

The Fed has kept a close watch on incoming economic data, especially measures tied to consumer prices and the labor market. Powell’s comments point to a policy path that remains dependent on the next round of reports rather than a fixed timetable.

For households and businesses, the message is that borrowing costs may stay elevated a little longer. Any future rate cut will likely depend on sustained evidence that inflation is under control and that the economy can absorb a shift in policy.