Possible that rates will rise to level that causes recession: Fed's Powell

His remarks underscore the challenge facing the central bank as it raises interest rates at the most rapid clip since the 1980s to slow the economy and cool inflation

Federal Reserve Chairman Jerome Powell said the central bank’s battle against inflation could lead it to raise interest rates high enough to cause an economic downturn.

“It’s certainly a possibility,” Powell said Wednesday during the first of two days of congressional hearings. “We are not trying to provoke and do not think we will need to provoke a recession, but we do think it’s absolutely essential” to bring down inflation, which is running at a 40-year high.

His remarks underscore the challenge facing the central bank as it raises interest rates at the most rapid clip since the 1980s to slow the