US Federal Reserve officials "are not confident" that interest rates are yet high enough to finish the battle with inflation, and may be nearing the end of how much help they can expect in lowering price pressures from improvements in the supply of goods, services and labour, Fed Chair Jerome Powell said on Thursday.

Powell said the Fed "is committed to achieving a stance of monetary policy that is sufficiently restrictive to bring inflation down to 2 percent over time; We are not confident that we have achieved such a stance."

"If it becomes appropriate to tighten policy further, we will not hesitate to do so," Powell said in remarks to an International Monetary Fund research conference, while adding that further policy moves would be conducted "carefully...allowing us to address both the risk of being misled by a few good months of data, and the risk of overtightening. We are making decisions meeting by meeting."

The fight to restore price stability "has a long way to go," the Fed chair said.

The progress on inflation to date has been relatively cost free in terms of lost jobs or rising unemployment, helped along by an easing of the supply chain problems that developed during the pandemic as well as an unexpected rise in the number of people available to take jobs.

But "it is not clear how much more will be achieved by additional supply-side improvements," Powell said, a development that could mark the end of those relatively pain-free gains in lowering inflation.

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. (Reuters)