Federal Reserve officials signaled that the pace of the U.S. economic recovery from the pandemic is bringing forward their expectations for how quickly they will reduce policy support.

Chair Jerome Powell told a press conference Wednesday that officials had begun a discussion about scaling back bond purchases after releasing forecasts that show they anticipate two interest rate increases by the end of 2023, projecting a faster-than-anticipated pace of tightening.

"The economy has clearly made progress," Powell said, noting that policymakers had debated how far the economy has traveled toward their threshold for scaling back $120 billion in monthly bond purchases. "While reaching the standard substantial further progress is still a ways off, participants expect that progress will continue," he said.