Federal Reserve Bank of Dallas President Richard Fisher said he believes the timing has moved up for the first main interest rate increase from close to zero because of a strengthening economy and higher inflation.
"It would seem to me and I have been arguing this that the date of so-called liftoff has been moved forward," Fisher said today in a CNBC interview. "I believe personally we have moved that forward significantly."
Fisher voted for the Fed's decision this week to trim monthly bond buying by $10 billion to $25 billion and to keep interest rates low for a "considerable time" after ending purchases. Philadelphia Fed President Charles Plosser dissented, objecting that the guidance on the timing of a rate is "time dependent" and doesn't reflect "considerable economic progress."
Fisher said today he felt ''comfortable'' with the Federal Open Market Committee's statement this week because of wording changes in describing the outlook for inflation, where policy makers said price gains have moved closer to their goal.
"I am very pleased at where we seem to be moving," he said.
Fisher said in a speech last month that with inflation speeding up and employment "rapidly improving," he is "increasingly at odds" with some participants on the FOMC.
The FOMC said in its July 30 statement that the job market has plenty of room for improvement, with a "significant underutilization of labor resources," even as the unemployment rate has fallen more rapidly than expected. Chair Janet Yellen has pointed to broader measures of the job market, such as underemployment and weak wage growth.
Fisher, a former money manager and deputy U.S. trade representative, has led the Dallas Fed since 2005. He dissented twice in 2011 against efforts to push down long-term borrowing costs and keep the benchmark interest rate near zero for a prolonged period.
The Dallas Fed chief voted in favor of tighter policy five times in 2008. His district includes Texas, northern Louisiana and southern New Mexico.
