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Fed's Evans could back 1 or 2 more rate hikes this year

A stronger U.S. economy and higher inflation figures mean the Federal Reserve could raise interest rates once or twice more this year, Federal Reserve Bank of Chicago President Charles Evans said Aug. 9, according to Reuters.

Evans dissented from one of the Fed's rate hikes in 2017, saying he wanted to see inflation trending higher before backing that action. With inflation now around the Fed's 2% goal, Evans told reporters in Chicago that he would support continued tightening from the Fed, Reuters reported. Inflation should remain around the 2% target and perhaps even mildly overshoot it, he said.

The Chicago Fed leader is not a voter this year on the Federal Open Market Committee, which raised its benchmark federal funds rate in March and June. Fed officials have remained split on whether to do so again one or two more times this year.

The ongoing uncertainty around trade could affect business investment and hit the economy, Evans said, but so far the economic impact "still seems to be relatively small." Evans said the tariffs come "against a context where the economy is very strong," lifted by business optimism over tax cuts, the regulatory environment and a stimulus boost from an increase in federal spending.