“Be prepared” said the Fed, for interest rates to remain elevated longer than expected. They now anticipate their overnight rate to be reduced more gradually over time, but do not necessarily expect the hoped for “soft landing” to materialize. Chair Powell asserted that the Fed foresees one more rate hike this year and is prepared to raise rates further if deemed appropriate to get down to their inflation goal of 2.0%.
Additionally, the Fed holds almost $9 trillion in mortgages and treasuries which they will continue to sell off to the open market. That increase in supply will raise mid- and longer-term rates further as yield rise to stay competitive.
The takeaway is that rates could get worse before they get better. It’s also possible that Jerome Powell was only talking tough on inflation.