Fed vice-chairman hints at interest rate increase in speech on inflation

'The door is definitely open' to a September rate increase, a senior economist said in response to Stanley Fischer saying factors that kept inflation down are fading

Federal Reserve vice-chairman Stanley Fischer left the door open Saturday for a Fed rate increase in September, saying the factors that have kept inflation below the central bank's target level have likely begun to fade.

Fischer said there's "good reason to believe that inflation will move higher as the forces holding down inflation dissipate further". He said, for example, that some effects of a stronger dollar and a plunge in oil prices - key factors in holding down inflation - have already started to diminish.