Powell Cites ‘Real Progress’ as Central Bankers Assess Inflation Fight

Jerome H. Powell, the chair of the Federal Reserve, said that inflation was once again coming down in the United States and that the Fed had “made quite a bit of progress” in cooling price increases back toward its goal.

Inflation “now shows signs of resuming its disinflationary trend,” Mr. Powell said on Tuesday at the European Central Bank’s annual conference in Sintra, Portugal. It was an optimistic message after the Fed’s fight against inflation hit a speed bump earlier this year.

Fed officials have been waiting to see further progress on inflation before they begin to lower interest rates, which are currently set to their highest level in decades, at 5.3 percent. Mr. Powell declined to say exactly when officials could begin to cut borrowing costs, but suggested that they could lower rates if inflation data continued on its current track or if the labor market weakened.

“What we’d like to see is more data like what we’ve been seeing recently,” Mr. Powell said, later adding, “We have the ability to take our time and get this right.”

Sitting next to Mr. Powell on the panel, Christine Lagarde, the president of the European Central Bank, said that European policymakers also weren’t in a rush to lower rates again, after an initial cut in June. E.C.B. officials would continuously reassess whether economic data gave them enough confidence to cut interest rates further, she added.

Inflation is “heading in the right direction,” she said. “But we still believe that it’s likely to be a bumpy road until the end of 2024.”