The Globe and Mail reports in its Friday edition that the U.S. economy's strength and continued tight labour markets could still warrant tighter financial conditions, Fed Chair Jerome Powell said on Thursday, though rising market interest rates could make action by the central bank less necessary. A Reuters dispatch to The Globe reports that Mr. Powell, appearing to align himself with Fed colleagues who have recently said the bond market is now doing some of their work for them, agrees "in principle" that the rise in yields was helping to further tighten financial conditions and "at the margin" might mean more rate hikes are not as needed. It was not an explicit endorsement of that view, but financial markets seemed to read it as such and as Mr. Powell spoke on Thursday they leaned further into bets that the Fed is done raising rates. Futures that settle to the Fed's policy rate are pricing less than a one-in-three chance of another rate hike this year, down from about 40 per cent before he spoke. In raising the Fed's benchmark interest rate "the whole idea is to affect financial conditions," Mr. Powell said. The Fed, Mr. Powell said, is "proceeding carefully" in evaluating the need for any further rate increases.