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The U.S. Federal Reserve should raise interest rates further this year and probably next year as well, despite U.S. President Donald Trump’s displeasure at tighter policy, Kansas City Federal Reserve Bank president Esther George said in interviews aired on Thursday.

“Based on what I see today, I think two more rate hikes could be appropriate,” along with several more next year as the Fed aims to move interest rates to a neutral setting of about 3 per cent, Ms. George told Bloomberg TV. The interview was taped on Wednesday, one day before the start of an annual central bankers’ conference in Jackson Hole, Wyo., which she hosts.

Mr. Trump earlier this week said he is “not thrilled” by the rate hikes Fed Chairman Jerome Powell has overseen since the U.S. President put him in the job in February.

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“Expressions of angst about higher interest rates are not unique to this administration,” she told CNBC in a separate interview. “We know higher interest rates cause adjustments in the economy.”

The Fed began its current round of interest-rate hikes under Fed chair Janet Yellen in December, 2015, and has lifted them every quarter since December, 2016.

The Fed currently targets short-term rates at between 1.75 per cent and 2 per cent. This is still well short of 2.5 per cent to 3 per cent, the level at which most Fed officials believe rates would no longer act as a stimulant to economic growth.

Ms. George is one of the Fed’s most hawkish policy-makers and in the past has consistently advocated a faster path of rate hikes than her colleagues. In the interviews aired on Thursday, however, she took care to hedge that view, a possible signal the Fed is reaching a point where rate-hike policy is less predictable.

Ms. George told Bloomberg TV that while upside risks to economic growth from fiscal stimulus could force the Fed to move faster than expected, financial and economic conditions could make the Fed stop short of her 3-per-cent estimate of neutral.

And to CNBC, she acknowledged the shape of the yield curve, which some Fed officials have said gives them pause about further rate hikes, does have an impact on policy-setting.

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