(fxcue news) - In a highly anticipated speech at the Jackson Hole Economic Symposium in Wyoming on Friday, Federal Reserve Chair Jerome Powell seemingly confirmed expectations that the central bank is prepared to begin lowering interest rates. "The time has come for policy to adjust," Powell said, although he noted the "timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks." Powell's determination that it is time for the Fed to begin cutting rates comes as his "confidence has grown that inflation is on a sustainable path back to 2 percent." Fed officials have repeatedly said they need "greater confidence" inflation is moving sustainably toward the central bank's 2 percent target before they would consider cutting rates. Powell said inflation is now much closer to the Fed's objective, with consumer prices rising 2.5 percent year-over-year in July, and noted progress toward 2 percent has resumed after a pause earlier this year. With regard to employment, Powell acknowledged that the labor market has cooled considerably from its formerly overheated state, with the unemployment rate rising to 4.3 percent. The Fed chief said the increase in the unemployment rate mainly reflects a substantial increase in the supply of workers and a slowdown from the previously frantic pace of hiring rather than elevated layoffs "Even so, the cooling in labor market conditions is unmistakable," Powell said, adding, "We do not seek or welcome further cooling in labor market conditions." Powell spent a large portion of his remarks discussing why inflation rose and why it has fallen so significantly even as unemployment has remained historically low, noting that the period "will be analyzed and debated long after we are gone." The remarks by Powell come as recent inflation data has increased confidence the Fed will cut interest rates at its next monetary policy meeting in September. According to CME Group's FedWatch Tool, there is a 67.5 percent chance of a quarter point rate cut at the September 17-18 meeting and a 32.5 percent chance of a half point rate cut. The minutes of the Fed's late July meeting, released on Wednesday, revealed that the "vast majority" of participants believed it would "likely be appropriate" to lower rates at the next meeting if inflation data continued to come in "about as expected."