WASHINGTON - The US Federal Reserve is in no rush to cut federal funds rate given the strong economy, Fed Chair Jerome Powell said Tuesday.

"With our policy stance now significantly less restrictive than it had been and the economy remaining strong, we do not need to be in a hurry to adjust our policy stance," he said at a hearing before the Senate Banking Committee, adding that reducing policy restraint too fast or too much could hinder progress on inflation.

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"Labor market conditions have cooled from their formerly overheated state and remain solid. Inflation has moved much closer to our 2 percent longer-run goal, though it remains somewhat elevated," he said.

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At its January meeting, the Fed held the policy rate steady in the range of 4.25 percent to 4.5 percent after cutting a full percentage point in the last three meetings of 2024.

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"That recalibration of our policy stance was appropriate in light of the progress on inflation and the cooling in the labor market," Powell said.

The Federal Open Market Committee will assess incoming data, the evolving outlook and the balance of risks, said the central bank chief. "As the economy evolves, we will adjust our policy stance in a manner that best promotes our maximum-employment and price-stability goals."