(Reuters) - Chicago Federal Reserve Bank President Charles Evans said on Friday that the U.S. central bank’s priority must be to get inflation back to its 2 percent target.
“The first order thing for policy right now is to get inflation up to our objective,” Evans said at a financial literacy event in Green Bay, Wisconsin.
He also said the labor market may still have further room to run, despite low unemployment.
Minutes of the Fed’s most recent meeting in September, released on Wednesday, showed that policymakers had a broad debate about the causes of weak inflation and the impact on interest rates if it fails to rebound.
Evans has been cautious about future interest rate rises and is currently advocating a wait-and-see approach on inflation.
The central bank’s preferred measure of inflation has been retreating from the Fed’s target rate for the past few months, and policymakers remain divided.
The Fed is well underway in a tightening cycle that began in late 2015. It has raised interest rates twice this year and still predicts another push upwards in the benchmark overnight lending rate by the end of 2017.
Investors predict the Fed will next raise interest rates in December.
Reporting by Lindsay Dunsmuir; Editing by Chizu Nomiyama