The remarks seemed more dovish than his comments in early October that the US central bank had a long way to go before interest rates hit neutral, indicating that more hikes could be on the horizon. Rather, he said, the Fed will assess the most recent economic and financial data in deciding whether or how fast to keep raising rates.
Powell said "interest rates are still low by historical standards, and they remain just below the broad range of estimates of the level that would be neutral for the economy".
The minutes of the November meeting showed Federal Open Market Committee policymakers had on their agenda a series of issues, ranging from a tightening of financial conditions, global economic risks, "and some signs of slowing in interest-sensitive sectors", that had begun to sway their assessment of the economy. But after that, officials said further hikes would not be on a preset course.
Analysts think a rate hike next month is all but certain, possibly in part because they think the Fed doesn't want to appear to be bowing to pressure from Trump. Financial markets have swooned in recent weeks, erasing much of the gains over the past year.
Eventually, the FOMC determined that a December interest rate hike was appropriate.
And some economists say the markets misread Powell. President Donald Trump stepped up attacks on Powell for rate hikes Trump sees as undercutting his economic and trade policies, telling the Washington Post just yesterday that he is "not even a little bit happy" with the Fed chief.
"I'm not dancing or partying right at the moment", he said, adding that the Fed has talked about gradual rate hikes "for a very long time". Earlier this month that contract's implied yield was a full quarter point higher at 2.95 percent, indicating that investors have now cut a full Fed rate hike from their expectations for the central bank's policy trajectory. From the Fed's perspective, the interest rate hike in December will probably lead to an interest rate level that will no longer justify the automatism of a quarterly interest rate hike. "They're making a mistake because I have a gut, and my gut tells me more sometimes than anybody else's brain can ever tell me".
"Should significant problems arise in China or in EMEs more broadly, spillovers, including dollar appreciation, declines in world trade and commodity prices, and a pullback from risk-taking by investors outside the affected markets, could be sizable", said the Fed in its report. He said the Fed was "way off base with what they're doing".
Nor did the Fed and other major economic bodies see the "excesses" that led to the financial meltdown of 2008, instead claiming that the United States and world economy had entered a period of "great moderation".
The Fed chairman said the central bank is monitoring potential vulnerabilities in the banking system to ensure its continued stability.
"I do think over time folks will have to get used to the idea that we can and will move at any meeting", said Powell in a question-and-answer session in Dallas.
"What do you do?" said Powell in NY.
But Wednesday's report stopped short of drawing "a bottom line conclusion" - a point Powell reiterated in his remarks, adding that the semiannual survey should be viewed as a routine checkup.