Fed Balancing Act: Powell Looks for Clear Inflation Drop Before Cutting Interest Rates

• Powell says more evidence needed that inflation is falling before Fed cuts rates • Fed has raised rates sharply to crush inflation, from near 0% to above 5% in 16 months • Fed trying to balance cutting rates too soon (could retrigger inflation) and too late (could trigger recession) • Fed held rates steady in March meeting, signaling still plans 3 rate cuts this year • Timing of rate cuts depends on inflation trajectory