Federal Reserve Chair Jerome Powell said the central bank could begin lowering interest rates later this year if inflation keeps easing. He emphasized that officials will continue to base their decisions on incoming economic data rather than a fixed timetable.

Powell’s comments reflect a cautious shift in the Fed’s outlook as policymakers watch whether price growth remains on a downward path. The central bank has kept borrowing costs elevated to slow inflation, but signs of moderation have increased expectations that cuts may be nearing.

Still, Powell made clear that any move will depend on the strength of upcoming reports on prices, jobs, and overall economic activity. The Fed has repeatedly said it wants more confidence that inflation is moving sustainably toward its target before easing policy.

For households and businesses, the timing of rate cuts matters because it can affect mortgage costs, credit card rates, and broader lending conditions. Markets are now looking closely at the next round of economic data to gauge whether the Fed will be able to act before the end of the year.