WASHINGTON — Federal Reserve Chair Janet Yellen raised the possibility Wednesday that the Fed would consider slowing the pace of its interest rate increases if inflation remained persistently below its target level.

For the moment, Yellen signaled no change in policy, indicating that the three rate increases since December will likely be followed by one more hike this year. She also said the Fed wants later this year to begin gradually trimming its massive $4.5 trillion in bond holdings, a move that will also put upward pressure on interest rates.

But Wall Street investors took heart from her slightly more cautious view of a recent puzzling slowdown in inflation, believing it could signal that the Fed that might be willing to put further rate hikes on pause.

“Monetary policy is not on a pre-set course,” Yellen told the House Financial Services Committee. “We’re watching it very closely and stand ready to adjust our policy if it appears that the inflation undershoot will be persistent.”

The Fed’s federal funds rate stands in a range of 1 percent to 1.25 percent. The last three increases occurred in December, March and June. Many analysts believe the Fed will raise rates one more time this year, in September or December.

Yellen’s appearance took on a bit of a valedictory tone, given that her four-year term as chair will end in early February before the next round of congressional hearings.

Yellen, the first woman to head the Fed, was asked several times if she would accept another term if President Donald Trump offered it. She didn’t provide a direct answer.

“I am very focused on trying to achieve our congressionally mandated objectives, and I really haven’t had to give further thought at this point” to the question of serving a second term, Yellen told Rep. Carolyn Maloney, D-N.Y.

In her testimony, Yellen took note of a number of encouraging factors, including strong job gains and rising household wealth that she said should fuel economic growth over the next two years.

Yellen repeated the message she has been sending all year that the U.S. economy no longer needs the extraordinary support the central bank began providing in 2008 in the wake of a severe financial crisis and the deepest recession since the 1930s.

Unemployment is down to 4.4 percent, near a 16-year low. And while the economy started the year with a sluggish growth rate of just 1.4 percent, it has regained momentum in recent months, helped by strong job gains, a revival of business investment and a strengthening of overseas economies.

But Yellen cautioned that “considerable uncertainty always attends the economic outlook.” Those include whether inflation will indeed pick up, as well as questions about how much of Trump’s economic program will make it through Congress.

At times during the hearing, Yellen sparred with her Republican critics who have criticized the Fed’s easy credit policies and its efforts to tighten bank regulations in the wake of the 2008 financial crisis.