In considering the appropriate rate levels moving forward, Powell said the Fed will proceed carefully.
"We will make decisions about the extent of additional policy firming and how long policy will remain restrictive based on the totality of the incoming data, the evolving outlook, and the balance of risks," he said.
The Federal Open Market Committee at its most recent meeting in September left the federal funds rate unchanged at a range of 5.25% to 5.5%. The committee in recent months has alternated between hikes and pauses — it approved a quarter-point increase at its prior meeting in July but did not raise rates in June.
In total, the Fed has raised the funds rate, which is now at its highest level since 2001, 525 basis points since March 2022.
During a question-and-answer session, Powell said the economy has remained resilient despite the Fed's rate hike campaign and that perhaps rates have not been high enough for long enough.
"As a practitioner, we have to be focused on what the economy is telling us, even taking lags into account," he said. "What's it telling us? Does it feel like policy is too tight right now? I would have to say no."
Inflation has been steady in recent months, and on Oct. 12 the Bureau of Labor Statistics reported that the consumer price index rose 3.7% year-over-year in September, the same pace as August.
Following the September CPI numbers, experts were divided about the Fed's next move.
According to the minutes of the Fed's September meeting, "a majority of participants judged that one more increase in the target federal funds rate at a future meeting would likely be appropriate."
Shortly after Powell's speech, market participants indicated there is a 98% probability that the Fed will leave rates unchanged at its next meeting, according to the CME FedWatch Tool that tracks trading in the 30-day fed funds futures.
The Fed's next meeting is Oct. 31-Nov. 1.