fed chair jerome powell came off dovish in a press conference following last weeks decision on rates he carried much of the same tone tuesday afternoon in an interview at the economic club of washington dc when he highlighted the key takeaways the message we were sending at the fomc meeting last wednesday was really that the disinflationary process the process of getting inflation down has begun powell said what to know last week the federal reserve raised its benchmark rate by 025 marking the central banks second consecutive policy downshift the move was in line with average economist expectations and came in the wake of a less aggressive rate hike from the fed in december at its last meeting of 2022 the fed opted for a 05 hike which was preceded by four straight 075 rate hikes the spdr sp 500 spy initially moved lower following the release as investors latched on to language that ongoing increases would be appropriate but powell seemed to send the message that the fed may be close to winding down its response to stubbornly high consumer prices wharton professor of finance jeremy siegel told benzinga last week that the only thing left standing between the fed and a pause is the strength of the labor market the fed wont pause until we get an actual negative number of payroll jobs siegel said in an exclusive interview on benzingas premarket prep related link exclusive wharton professor jeremy siegel says theres only one indicator left standing between the federal reserve and a pause shortly after the fomc meeting new data came out that showed the labor market continued to remain resilient in january when powell was asked if the committee would have made a different decision if it had seen the jobs data prior to the fomc meeting powell said we dont get to play it that way he then followed that up by reiterating that although inflation is coming down it still has a long way to go the goods sector is showing a positive trend but the services sector is not showing any disinflation yet he said the labor report for january was stronger than what powell had anticipated he said it kind of shows you why we think that this will be a process that takes a significant period of time by the way its a good thing that inflation has started to come down  and that has not happened at the cost of a strong labor market he added the fed chair reiterated that ongoing increases will likely be appropriate to bring inflation down to the committees 2 goal over time but he explained that the fed remains data dependent all of these numbers that we are throwing around here are conditional on incoming data and what happens so we never say this is what we think will happen we make a tentative forecast and then we let the data come in powell said the fed will get a look at several new data sets before it makes its next decision on rates in late march most economists are turning their attention to the january cpi print due feb 14 but as siegel pointed out the strength of the labor market appears to be inhibiting the fed from opting for a pause powell told listeners at the washington dc economic club that inflation will not go away quickly or painlessly the committees base case is that it will need to continue to raise rates before it can look to incoming data to see if it has done enough if the labor market continues to remain strong or cpi data moves higher powell noted that the fed may need to hike rates more than what the market is currently pricing in following last weeks decision the bond market was projecting an 856 chance of a subsequent 025 hike in march and a 144 chance of a pause in the wake of powells comments the market is currently projecting a 937 chance of a subsequent 025 hike in march and a 63 chance of a 05 hike according to cme group data check this out fed chairman jerome powell celebrates 5 year anniversary 5 things you might not know about him spy price action the spy initially spiked higher on early comments from the fed chair tuesday afternoon before reversing and turning negative after powell suggested that a 05 hike is still on the table for the next meeting the spy was down 033 at 40851 at the time of writing according to benzinga pro