(Bloomberg) -- Federal Reserve Vice Chairman Stanley Fischer said on Friday the central bank looked most likely to raise interest rates in June or September, although economic developments might warrant different timing for liftoff.
“I don’t think there is an emphasis on June instead of September” Fischer told a monetary policy forum in New York. He added that judged by the views of Fed officials and investors “it seems those two months get the main weight of probability.”
At the same time, he said, “things could happen” that could change those assumptions. “We will make a decision and we will make it on the basis of evidence.”
Fed Chair Janet Yellen this week began to prepare the
ground for an interest-rate increase this year for the first time since 2006, without saying that a move was imminent. In testimony to Congress, she signaled that the central bank might drop its pledge to be “patient,” which would mean that rates could be raised at any meeting.
In an interview later with CNBC, Fischer said “there’s a pretty high probability that this is the year” the Fed will raise interest rates. He said the Fed is “very close” to its goal for full employment, and that inflation should move higher as the impact of low oil prices dissipates.
“We’ve gotten used to thinking about a zero interest rate as normal,” he said. “It’s far from normal.”
William C. Dudley, president of the New York Fed, sounded a note of caution in prepared remarks delivered earlier in the day to The 2015 Monetary Policy Forum sponsored by the University of Chicago Booth School of Business.
“There are some reasons to be cautious in how early and fast one should raise short-term interest rates,” he said, citing low inflation and “lingering headwinds” from the financial crisis.