The Federal Reserve could hike interest rates up to two times before year end, a top U.S. central banker said on Wednesday, slightly downgrading his expectations for monetary tightening even though he said the economy is on “fairly firm footing.”
Philadelphia Fed President Patrick Harker, when he last spoke publicly in late May, predicted two to three rate increases this year. Since then U.S. jobs growth plunged one month and then shot back up the next, while Britons voted to leave the European Union.
Harker, who has been at the Fed for a year, downplayed any effects of the so-called Brexit referendum. He said first-quarter U.S. economic weakness was largely due to seasonal adjustments, and predicted both that inflation would hit a 2 percent target in 2017 and that the Fed would raise rates toward 3 percent by the end of 2018.