Federal Reserve Chair Jerome Powell said the US central bank will continue to move carefully but won’t hesitate to tighten policy further if needed to contain inflation.

“If it becomes appropriate to tighten policy further, we will not hesitate to do so,” Powell said in opening remarks prepared for a panel discussion at an International Monetary Fund conference in Washington on Thursday.

“We will continue to move carefully, however, allowing us to address both the risk of being misled by a few good months of data, and the risk of overtightening,” he said.

Powell said policymakers are committed to ensuring interest rates are high enough to return inflation to their 2% target, but added, “we are not confident that we have achieved such a stance.”

The Fed chair said supply-side benefits that have helped slow inflation so far may have run their course, and repeated that stronger growth could warrant further tightening.

“We still believe the Fed is done hiking for this cycle, but today’s speech should serve as notice that their rhetoric must stay hawkish until they’ve seen further improvement in inflation,” JPMorgan Chase & Co. Chief US Economist Michael Feroli said in a note to clients.

Treasuries extended their losses from a poorly received 30-year bond sale after Powell’s remarks, and the market pushed the timing of the Fed’s first expected quarter-point rate cut out to July from June next year.

US central bankers are trying to assess whether they need to take their benchmark policy rate slightly higher, and debating how long they should hold rates at elevated levels. The policy-setting Federal Open Market Committee last week held rates at 5.25% to 5.5% range, the highest level in 22 years.

Inflation has decelerated, but remains above the Fed’s target, at 3.4% for the year through September. Fed officials are set to meet again on December 12-13.

In his speech, the Fed chief said it wasn’t clear how much more inflation progress can be made in the future through supply-side improvements.

“Going forward, it may be that a greater share of the progress in reducing inflation will have to come from tight monetary policy restraining the growth of aggregate demand,” Powell said.

He also suggested the central bank will undertake another review of its policy framework beginning in 2024, after announcing an overhaul in 2020.

“Among the questions we will consider is the degree to which the structural features of the economy that led to low interest rates in the pre-pandemic era will persist,” Powell said. “With time, we will continue to learn from the experience of the past few years, and what implications it may hold for monetary policy.”

Shortly after he began speaking, Powell was hustled out of the conference room as a group of about a dozen environmental protesters jumped on stage. Brandishing a banner, they chanted and spoke out for about five minutes before departing.