The US is on the verge of meeting most of the economic conditions the Federal Reserve has set to increase interest rates next month, according to a…

The US is on the verge of meeting most of the economic conditions the Federal Reserve has set to increase interest rates next month, according to a member of the rate-setting Federal Open Market Committee

Eric Rosengren, the president of the Federal Reserve Bank of Boston, told the Financial Times he was getting ready to back tighter monetary policy after financial and economic indicators swung in a positive direction after the Fed’s policy meeting in March

Until last week markets were putting extremely low odds on a summer rate increase, in part because of the dovish tone of Fed chair Janet Yellen’s last speech two months ago. That picture was transformed on Wednesday, as the Fed minutes from its April rate-setting meeting suggested it was preparing the ground for a second interest rate increase following the quarter point rise in December

“I want to be sensitive to how the data comes in, but I would say that most of the conditions that were laid out in the minutes, as of right now, seem to be . . . on the verge of broadly being met,” said Mr Rosengren, who has a vote on rates this year as part of the regular rotation of regional Fed presidents on the FOMC

To justify a move at its next policy meeting in June, the Fed set itself three tests: to see additional signs of a rebound in the economy in the second quarter, further strengthening in the jobs market and for inflation to carry on towards the Fed’s 2 per cent goal. While policymakers are divided over whether these conditions will all be met by next month, Mr Rosengren said he saw the preconditions for a June rise falling into place