Fed Chair Jerome Powell spoke last Friday at the annual Jackson Hole Symposium, which is a gathering of economists, central bankers and policy makers from around the world. While Powell acknowledged that progress has been made in the fight against inflation, his comments were relatively hawkish (hawks are policy makers who favor higher interest rates to keep inflation in check).

Powell said, “Although inflation has moved down from its peak – a welcome development – it remains too high. We are prepared to raise rates further if appropriate, and intend to hold policy at a restrictive level until we are confident that inflation is moving sustainably down toward our objective.”

What’s the bottom line? Remember, the Fed has been hiking its benchmark Fed Funds Rate (which is the overnight borrowing rate for banks) to try to slow the economy and curb inflation. Their latest hike in July was the eleventh since March of last year, pushing the Fed Funds Rate to the highest level in 22 years. Powell said that the Fed will proceed carefully in upcoming meetings as they assess incoming data and the evolving outlook and risks.

Powell also reiterated that the Fed's inflation goal is still 2% and that he sees the current economic stance as restrictive, putting downward pressure on economic activity, hiring and inflation. The Fed appears hyper focused on the extremely tight labor market, and they likely want to see a weaker labor sector and weak Jobs report before their outlook changes.

Fed members will certainly be watching as crucial labor data will be reported this week, especially headline job growth in August’s Jobs Report coming on Friday.