Federal Reserve Chair Jerome Powell said Wednesday that the central bank is thinking about reducing its interventions in the bond markets.

The Fed’s policymaking Open Markets Committee began discussing when to reduce its monthly bond purchases during its regular meeting Wednesday. But at a post-meeting press conference, Powell made clear that the Fed has yet to decide when it will do so. The purchases, which consist of $120 billion in Treasury and mortgage bonds, are intended to keep longer-term rates low to encourage borrowing. The policy has helped fuel a nation-wide homebuying spree in the last 12 years.

The Fed has made clear that its first step in slowing its support for the economy will be to pare its bond purchases – and that it would begin to raise rates only sometime after that. Its key rate has been pinned near zero since March 2020.

At the same time, Powell sought Wednesday to dispel any concerns that the Fed might be in a hurry to withdraw its economic support by making borrowing more expensive. The economy, he said, still hasn’t improved enough to reduce the pace of the monthly bond purchases, which the Fed has said it intends to continue until “substantial further progress” has been made toward its employment and inflation goals.

“We are a ways away from substantial further progress, we think,” Powell said at his news conference. “But we are making progress.”

The Fed is grappling with a dilemma: Inflation is rising much faster than it had projected earlier this year. And America’s increasingly vaccinated consumers are now comfortable venturing away from home to travel, go to restaurants and movie theaters and attend sporting events. Solid consumer spending is accelerating economic growth, and manufacturing and housing have significantly strengthened.

Yet hiring hasn’t picked up as much as expected. Monthly job growth has remained below the 1 million-a-month level that Powell had said in April he would like to see, though employers are clearly interested in hiring more, having posted a record number of available jobs.

Since December, the Fed has said it wants to see “substantial further progress” toward its goals of full employment and inflation modestly above 2 percent before it would begin tapering its bond purchases.

The central bank on Wednesday raised its forecast for inflation to 3.4 percent by the end of this year, from 2.4 percent in its previous projection in March. Yet the officials foresee price increases remaining tame in the following two years.

Fed officials also expect the economy to grow 7 percent this year, which would be the fastest calendar-year expansion since 1984. They project that growth will slow after that, to 3.3 percent in 2022 and 2.4 percent in 2023.

Economists generally expect the Fed to continue discussing tapering its bond purchases and then – by late August or September – to outline specifically how and when it would begin. That would set the stage for a reduction in bond purchases to actually begin near the end of this year or in early 2022.

Another key consideration for the Fed is whether inflation persists long enough to affect the public’s behavior. If Americans begin to expect price increases, those expectations can trigger a self-fulfilling cycle as workers demand higher wages, which, in turn, can lead their employers to keep raising prices to offset their higher labor costs.

Powell said that measures of longer-term inflation expectations have increased in recent months, after falling at the outset of the pandemic. But they mostly remain in a range consistent with the Fed’s 2 percent inflation target.

“It’s gratifying to see them having moved up off of their pandemic lows,” he said.