Nov 15 (Reuters) - The U.S. Federal Reserve should “proceed cautiously” with interest rate increases, keeping a “keen eye on the data” so as not to raise rates too far or not far enough, Atlanta Fed President Raphael Bostic said on Thursday.
“I don’t think we are too far from a neutral policy, and neutral is where we want to be,” Bostic said in remarks prepared for delivery to the Global Interdependence Center in Madrid, Spain. “We may not be there quite yet, but I am inclined to think that a tentative approach as we proceed would be appropriate.”
Bostic said that with unemployment at 3.7 percent and inflation at or near the Fed’s 2-percent goal, conditions warrant the “final steps” in adopting a neutral stance of monetary policy. If economic data show clearer signs of overheating, he said, he is prepared to support a more aggressive approach.
The Fed next meets in mid-December, and is widely expected to raise interest rates then. (Reporting by Ann Saphir Editing by Chizu Nomiyama)