US Fed's Mester: further rate hikes appropriate

Loretta Mester, President of the Federal Reserve Bank of Cleveland and voting member of the FOMC, has given her outlook on the Fed, the US economy, and monetary policy.

Key highlights

Further rate hikes are appropriate for both this year and next.

Gradual rate hikes would avoid overheating and other financial stability risks.

Expects GDP growth in the US to be greater than 2.5 percent this year.

Mester's outlook has not changed despite financial market volatility, trade, and geopolitics.

Fed monetary policy is still accommodative, as is financial conditions.

US is "slightly beyond" full employment.

Expects inflation to hit two percent over the next year or two.