The Federal Reserve (Fed) may slow the pace of interest rate hikes following its December meeting, US Central Bank Chairman Jerome Powell said.

“The time to moderate the pace of rate hikes may come as early as the next meeting,” he said during a speech at the Brookings Institution on Wednesday.

At the same time, the Fed chief tried to balance those words with hawkish signals, Market Watch notes. Among other things, he said that the final peak in rates should be higher than might have been expected a few months ago.

In addition, Powell made it clear that a rate cut is off the table at this point. “History strongly cautions us against premature policy easing,” he said.

Judging by futures quotes for the benchmark rate, the market is waiting for the Fed to raise it by 50 basis points in December to 4.25-4.5% per annum. The Fed raised the rate by 75 bps at each of the previous four meetings.

The next meeting of the Central Bank leadership is scheduled for December 14-15. It will be accompanied by the publication of updated economic forecasts.

In September, the Fed expected the “ceiling” rate to be in the range of 4.5-4.75% per annum. However, economists believe that the central bank intends to keep raising until rates are somewhere between 5% and 5.5%.

Specifically, Goldman Sachs analysts predict the Fed will raise rates by 50 bps in December and then raise the rate three times by 25 basis points in February, March and May next year, bringing it to a peak of 5-5.25% per annum.

Powell also touched extensively on inflation in his speech Wednesday.

“The truth is that the path of inflation remains highly uncertain,” he said.

The Fed chief predicts that consumer price inflation (PCE index) will slow to 6% in October from 6.2% the previous month and core inflation will fall to 5% from 5.1%.

“Despite the tightening of monetary policy and the slowdown in economic growth over the past year, we have seen no clear progress in easing inflation,” he said. – It will take considerably more evidence to be convinced that inflation is really coming down.”

Powell still believes the U.S. economy can avoid a serious recession. “I continue to believe that there is a path to a soft landing. I think that’s very plausible,” he stated.