A Federal Reserve official says the central bank should raise interest rates this year to guard against inflation.
Narayana Kocherlakota, president of the Federal Reserve Bank of Minneapolis, is part of a vocal minority that thinks the Fed will need to reverse course this year and start tightening credit.
Kocherlakota says the Fed should raise its key interest rate, now near zero, by one-half percentage point. He says even with the increase, rates would still be considered low by historical standards.
The president of the Federal Reserve Bank of Philadelphia also has said the Fed may need to raise rates this year. And the president of the Federal Reserve Bank of Dallas has said the Fed may need to tighten credit but hasn't specified when or how.