JACKSON HOLE (Wyoming): Federal Reserve Chair Jerome Powell on Friday pointed to a possible interest rate cut at the US central bank’s meeting next month, but stopped short of committing to it, in remarks acknowledging both the growing risks to the job market and ongoing threat of higher inflation.

“While the labor market appears to be in balance, it is a curious kind of balance that results from a marked slowing in both the supply of and demand for workers.

This unusual situation suggests that downside risks to employment are rising. And if those risks materialize, they can do so quickly,” Powell told an audience of international economists and policymakers at the Fed’s annual Jackson Hole conference in Wyoming.

“It is also possible, however, that the upward pressure on prices from tariffs could spur a more lasting inflation dynamic, and that is a risk to be assessed and managed.” “The stability of the unemployment rate and other labor market measures allows us to proceed carefully as we consider changes to our policy stance. Nonetheless, with policy in restrictive territory, the baseline outlook and the shifting balance of risks may warrant adjusting our policy stance,” the Fed chief said, noting that while tariffs are expected to drive prices higher, the baseline case is for their impact on inflation to fade.—Reuters