Fed chair Powell to Congress: Don't expect rate cuts imminently

What he's saying: "If the economy evolves broadly as expected, it will likely be appropriate to begin dialing back policy restraint at some point this year," Powell said before the House Financial Services Committee.

• "But the economic outlook is uncertain, and ongoing progress toward our 2 percent inflation objective is not assured," Powell said.
• The Fed's policy committee "does not expect that it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2 percent."

The big picture: Key data out last month showed that getting inflation back to the Fed's 2% target might take longer than expected.

• In recent weeks, Fed officials have reiterated that they want further proof that inflation is truly receding before cutting interest rates.
• In response to a question from Rep. Patrick McHenry (R-N.C.), Powell said that the Fed can afford to wait a bit longer before deciding when to cut rates.
• "We think because of the strength in the economy and the strength and the labor market ... we can approach that step carefully and thoughtfully," Powell said.

Zoom in: A key question from lawmakers Wednesday dealt with the status of a contentious bank regulatory proposal released last year by the Fed and other regulatory agencies.

• Among other requirements the proposal would hike capital requirements for big banks. It's faced fierce criticism, including from some top officials at the Fed.
• "We do hear the concerns and I do expect that there will be broad and material changes to the proposal," Powell said, adding that a re-proposal was a "plausible" option.
• "I am confident that the final product will be one that does have broad support both at the Fed and in the broader world," Powell said.

Go deeper: January inflation pickup eats into income gains

Editor's note: This story has been updated with a new photo and additional details from Wednesday's hearing.