Addressing a group of teachers, Mr Powell said that one of the Fed's goals when releasing economic projections “is to influence spending and investment decisions today and in the months ahead”.
But “that will only be the case” if the public understands how the Fed's monetary decisions affect their own finances.
Teachers, he said, play a key part in this process.
“Economic educators impart knowledge that is instrumental in how the Federal Reserve promotes a healthy economy. In a way, when you are teaching students, you are also conducting monetary policy,” he said.
Mr Powell also discussed the basics of understanding economics, the Fed's role in the federal government and how the central bank operates.
“Our main tool, of course, is interest rates,” Mr Powell said.
The Fed earlier this month left interest rates unchanged between 5.25 per cent and 5.50 per cent. It was the second pause in three meetings.
The Fed's latest economic projections showed that a majority of those at the Fed also favoured one more quarter-rate increase this year.
They also forecast that interest rates would be held at a higher level for a more prolonged period of time because of the resiliency of the US economy.
Speaking on the changes the Fed has made since the 2008 financial crisis, Mr Powell said central banks have become a more transparent institution.
“When I was in college, central banks were a lot about mystery and keeping everybody on the backside,” he said.
With a more transparent central bank now, markets can react and effect spending before the Fed's interest rate meetings.
“They know how the Fed is thinking … and financial conditions will change now,” Mr Powell added, pointing to the onset of the Fed's monetary-tightening cycle in March 2022.
Recently, Mr Powell has cautioned markets that the central bank would be prepared to raise rates if data merits it, even though the Fed appears to be near or at the end of its rate increases.
He has also said rates would be held at a restrictive level until the Fed is convinced that inflation is moving down sustainably.
He did not comment or offer clues on future Fed decisions during the town hall.
Traders expect interest rates to be held steady the remainder of this year, data from the CME Group showed.