(Reuters) - U.S. Federal Reserve Chair Jerome Powell said on Wednesday that continued progress on inflation "is not assured," though the central bank still expects to reduce its benchmark interest rate later this year.

"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 in remarks prepared for delivery to the House Financial Services Committee as U.S. lawmakers prepare to face inflation-weary voters in a charged presidential election year.

"But the economic outlook is uncertain, and ongoing progress toward our 2% inflation objective is not assured," Powell said.

COMMENTS:

RICK MECKLER, PARTNER, CHERRY LANE INVESTMENTS, NEW JERSEY

"I don't think stock investors expected much different from him (Powell). It's still significant that they (the Fed) expect rates to be lowered later this year and that's really what investors have been focused on - that the end seems in sight for the really restrictive front-end rates."

"(Investors) continue to seek stocks that have high growth rates and can do well in the current economy."

KARL SCHAMOTTA, CHIEF MARKET STRATEGIST, CORPAY, TORONTO

    "Powell clearly warned markets against expecting an imminent pivot to rate cuts, following in many of his colleague's footsteps in saying that the Fed will need "greater confidence that inflation is moving sustainably to 2%" before beginning to ease. He did acknowledge that it will likely be appropriate to begin dialing back policy restraint at some point this year," but also noted that price risks - as embodied in January's hotter-than-expected data - could mean that "ongoing progress toward our 2% inflation objective is not assured".

    "Odds on an upward move in the "dot plot" summary of economic projections at the Fed's late-March meeting are firming somewhat, but Powell broadly failed to "outhawk" markets and the dollar is holding steady relative to its major rivals."

(Compiled by the Global Finance & Markets Breaking News team)