Federal Reserve Chair Jerome Powell said Tuesday that asset prices, including stocks, are currently elevated.

Speaking in Providence, Rhode Island, he noted that the Fed monitors financial conditions to ensure policies achieve their goals, acknowledging that equities are “fairly highly valued.”

Stocks had rallied ahead of last week’s policy meetings on expectations of an interest rate cut and set record highs following the Fed’s quarter-point reduction.

Powell added that markets react to Fed guidance by pricing in anticipated rate changes, including for mortgage rates, CNBC has reported.

Despite high equity values, he stressed that financial stability risks are not elevated, though stocks fell after his comments.