Jerome Powell spoke Thursday during the Jackson Hole economic symposium. The Federal Reserve Bank of Kansas City’s annual event is being conducted virtually due to the coronavirus pandemic and streamed live to the public for the first time.

Photo: Daniel Acker/Bloomberg News

The Federal Reserve unanimously approved on Thursday a new strategy that will effectively set aside a practice it has followed for more than three decades to pre-emptively lift interest rates to head off higher inflation.

Fed Chairman Jerome Powell unveiled the updates in a speech set for delivery at a virtual symposium on Thursday, the most ambitious revamp of the Fed policy-setting framework since it was first approved in 2012. The practical effect is that it may be a very long time before the Fed considers raising interest rates.

Mr. Powell said the changes reflected lessons the central bank officials had learned in recent years about how inflation didn’t rise as anticipated when unemployment fell to historically low levels.