Federal Reserve Chair Jerome Powell indicated that it may soon be time to lower interest rates in the United States, raising the likelihood of a rate cut in the near future. In his speech at the Jackson Hole Economic Symposium, Powell noted that monetary policy needs to adjust to the current economic conditions, with the timing and extent of the rate cuts depending on incoming economic data and the overall outlook.

Following Powell's comments, U.S. stock markets rallied, with all major indices showing significant gains. Analysts from Bank of America suggested that Powell's speech strongly hinted at a rate cut in September, although they do not yet foresee significant recession risks.

The Federal Reserve's interest rates, currently at their highest in 23 years, have been effective in curbing demand and managing inflation ahead of the upcoming presidential elections. Powell expressed growing confidence that inflation is moving towards the Fed's 2% target without significantly impacting economic growth or employment.

The minutes from the Fed's July meeting suggested that most members of the rate-setting committee might support a rate cut if economic data aligns with expectations. Analysts are now debating whether the Fed will opt for a modest quarter-point cut or a larger half-point cut in the upcoming meetings, depending on the performance of the labor market and other economic indicators.

Overall, the financial markets and analysts anticipate a series of rate cuts through the end of the year, with a potential for more aggressive cuts depending on how the economic data unfolds.