With a strong labor market and inflation on its way to 2%, Federal Reserve Bank of Philadelphia President and CEO Patrick T. Harker expects three increases in the fed funds rate target this year, he said Thursday.

"I see three modest hikes as appropriate for the coming year, assuming the economy stays on track," Harker said, according to prepared text of a speech to the Main Line Chamber of Commerce, released by the Fed. "Fed policymakers enjoy saying we're data-dependent and this is an area where that rings especially true."

But he noted monetary policy can only do so much. Policies to spur growth, such as, "employment programs, development, taxation, and trade policy — is up to elected officials at the local, state, and national levels."

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