Fed chair expects interest rates will increase "somewhat further" this year

What they're saying: "[I]nflation pressures continue to run high, and the process of getting inflation back down to 2 percent has a long way to go," Powell said in his opening statement at a House Financial Services Committee hearing.

• Reducing inflation will likely require slower economic growth and "some softening of labor market conditions," he added.

Catch up quick: For the first time in 15 months, the Fed did not raise interest rates at the conclusion of its policy meeting last week.

• However, new projections released alongside that decision showed officials expect two more rate increases by the end of 2023 — moves that could come as soon as next month.

Between the lines: In his prepared remarks, Powell acknowledged that rates could rise "somewhat further." But he said that Fed officials "judged it prudent" to keep rates steady last week so the central bank could assess how its previous moves are working through the economy.

• He added: "The economy is facing headwinds from tighter credit conditions for households and businesses, which are likely to weigh on economic activity, hiring, and inflation," though the extent to which remains uncertain.

• The Fed will make decisions about further rate increases "meeting by meeting," Powell said.

Of note: The Senate on Wednesday will also start confirmation hearings for Fed vice chair nominee Philip Jefferson and governor nominee Adriana Kugler, as well as a 14-year full term for Fed Governor Lisa Cook.

Editor's note: This story was updated with new information.