Powell spoke Tuesday in Providence, R.I. It was his first speech since the central bank lowered key interest rates last week.
"Two-sided risks mean that there is no risk-free path," Powell said.
The chairman said President Donald Trump's tariff-focused overhaul of global trade could lead to price increases in the coming months.
"The overall economic effects of the significant changes in trade, immigration, fiscal and regulatory policy remain to be seen," Powell said. "A reasonable base case is that the tariff-related effects on inflation will be relatively short lived – a one-time shift in the price level."
But it won't come all at once, the central banker said.
"A 'one-time' increase does not mean 'all at once.' Tariff increases will likely take some time to work their way through supply chains," Powell said. "As a result, this one-time increase in the price level will likely be spread over several quarters and show up as somewhat higher inflation during that period."
However, the path forward remains cloudy.
"But uncertainty around the path of inflation remains high," Powell noted. "We will carefully assess and manage the risk of higher and more persistent inflation. We will make sure that this one-time increase in prices does not become an ongoing inflation problem."