Speaking at the U.S. Monetary Policy Forum in New York City, Federal Reserve Chair Jerome Powell emphasized the need for a careful approach to monetary policy. He made it clear that the Fed is in no hurry to cut interest rates, choosing instead to adopt a wait-and-see stance.

“We don’t need to rush, and we are well-positioned to wait for more clarity,” Powell stated.

Job Market Remains Strong Despite Slight Unemployment Rise

Powell pointed to the resilience of the U.S. labor market, noting that 151,000 new jobs were added in February. Since September, the average monthly job loss has been 191,000.

📊 Despite a slight uptick in the unemployment rate to 4.1%, it remains within the 3.9% – 4.2% range observed over the past year. Powell highlighted that wage growth has leveled off, bringing better balance between labor supply and demand.

“With wage growth moderating and the labor market stabilizing, it is no longer a significant source of inflationary pressure,” Powell explained.

Inflation Drops but Remains Above Target

Powell noted that inflation has fallen from a peak of over 7% in mid-2022 to 2.5% in January 2025. However, this still exceeds the Federal Reserve’s 2% target.

“The path to bringing inflation sustainably down to our goal has been bumpy, and we expect it to remain that way.”

The Fed remains focused on inflation trends, ensuring that monetary policy decisions won’t be rushed.

Trade Policy and Interest Rate Outlook

Powell also addressed the Biden administration’s recent trade measures, including the announced—and later postponed—tariffs impacting Mexico, Canada, and China. These policy shifts are increasing volatility, complicating economic forecasts.

🔹 As for interest rates, Powell suggested that the Fed is unlikely to cut rates in the coming months.

🔹 By late 2024, the benchmark interest rate was cut by 100 basis points to a range of 4.25% – 4.5%, and this remained unchanged in January 2025.