Federal Reserve chair nominee Jerome Powell said the case for raising interest rates at next month’s policy meeting is strengthening as the labor market improves without overheating the U.S. economy.

Federal Reserve Board Governor Jerome H. Powell.
Federal Reserve Board Governor Jerome H. Powell. Bloomberg News

Powell was picked by President Donald Trump to replace Fed Chair Janet Yellen when her term ends in February. He spoke at his confirmation hearing in Washington before the Senate banking committee. The Fed will hold its final policy meeting of the year from Dec. 12-13.

“I think the case for raising interest rates at our next meeting is coming together,” Powell told Senator Dean Heller, a Nevada Republican. “Conditions are supportive of doing that.”

Powell, who has served as a Fed governor since 2012, said that he couldn’t guarantee that he would vote for a rate increase because he had to hear the views of his Federal Open Market Committee colleagues at the meeting.

The benchmark lending rate is currently in a range of 1% to 1.25%. A December increase would represent the third tightening of policy this year and only the fifth rate hike since the expansion began in mid-2009.

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