Fed Officials Differ On Rate Hike Outlook

(RTTNews) - A pair of Federal Reserve officials offered differing views on when the central bank should hike interest rates from zero.

The first rate hike is not likely to be warranted until at least the last half of next year, Atlanta Fed President Dennis Lockhart said Wednesday.

However, if the economy doesn't grow as expected, Lockhart says "a later liftoff date than I am assuming will likely be appropriate."

"I believe the FOMC is still significantly short of achieving its two mandated objectives" of maximum employment and healthy consumer price inflation, Mr. Lockhart said. Because of this, "monetary policy should remain quite accommodative for some time."

Lockhart does not vote on Fed policy this year, but assumes a voting role in 2015.

Meanwhile, St. Louis Fed President James Bullard offered a more hawkish outlook for the first rate hike.

Speaking to Bloomberg Radio, Bullard said he expects the first rate hike to come in the first quarter of 2015.

He believes the unemployment rate will fall to around 6 percent by the end of this year, allowing the Fed to gradually hike rates as long as inflation runs near the central bank's 2 percent target.