Fed officials make case for lifting central bank’s key interest rate before year-end

NEW YORK: Three Federal Reserve policy makers argued on Saturday for lifting the central bank’s key interest rate before year-end, countering bets by many traders that the Fed will wait until 2016. Laying out their rationale for a rate increase at one of the Fed's two remaining meetings of 2015, the central bankers cited continued improvement in the domestic economy, including low unemployment, which they suggested overshadowed concerns about global conditions and volatile financial markets.

San Francisco Federal Reserve Bank President John Williams, St. Louis Fed President James Bullard and Richmond Fed President Jeffrey Lacker each spoke or wrote on Saturday, days after the policy-setting Federal Open Market Committee voted on Thursday to leave rates unchanged.

The central bank's decision, and the way its deliberations were framed, were interpreted by many Fed watchers as a sign that the central bank might not raise rates this year. In holding rates steady, the Fed noted international uncertainties and subdued inflation.

“It was a close call in my mind, in part reflecting the conflicting signals we're getting,” Williams said of the decision during a speech in Armonk, New York. “I view the next appropriate step as gradually raising interest rates, most likely starting sometime later this year.”