Federal Reserve Chair Jerome Powell on Friday opened the door ever so slightly to lowering a key interest rate in the coming months but gave no hint on the timing of a move and suggested the central bank will proceed cautiously as it continues to evaluate the impact of tariffs and other policies on the economy.

Friday's rally in U.S. government debt, sparked by Federal Reserve Chair Jerome Powell's decision to signal a possible rate cut, sent yields to the lowest closing levels in a week and contributed to all or most of their weekly declines.

Federal Reserve Chair Jerome Powell on Friday pointed to a possible interest rate cut at the U.S. central bank's meeting next month, but stopped short of committing to it, in remarks acknowledging both the growing risks to the job market and ongoing threat of higher inflation.

Federal Reserve Chair Jerome Powell warned that the tariffs unleashed by U.S. President Donald Trump are pushing consumer prices higher and would continue to do so over the coming months.

Fed Chair Powell hints at possible rate cuts in September, signaling a policy shift. Click here to read what investors need to know.

Wall Street's main indexes ended higher on Friday, with the blue-chip Dow hitting a record closing high, as investors piled into stocks after U.S. Federal Reserve Chair Jerome Powell hinted at a near-term interest-rate cut during his Jackson Hole Symposium speech.

Federal Reserve Chair Jerome Powell on Friday said the central bank faces a "challenging situation" as a hiring slowdown coincides with tariff-driven price increases, putting pressure on both sides of the Fed's dual mission to maximize employment and control inflation.

Inflation expectations derived from the bond market were rising on Friday, suggesting simmering concerns about future price gains despite Federal Reserve Chair Jerome Powell's willingness to consider cutting interest rates.