New York Federal Reserve president William Dudley said on Monday that the recent limp inflation readings would give way and that further interest rate increases will "likely" be necessary.
In a speech at Syracuse in New York, Dudley said that the US economy continued on its trajectory of slightly above-trend growth which would, over time, support a rise in wage growth.
He downplayed the impact of recent hurricanes on the medium-term outlook for the economy, although they would make interpreting near-term data more difficult.
Inflation and rates
Combined with the trend of firmer import prices due to the weaker dollar and the fading effects from a "number of temporary, idiosyncratic factors", Dudley expects inflation will rise and stabilise close to the Fed's 2% target rate.
"In response," Dudley added, "The Federal Reserve will likely continue to remove monetary policy accommodation gradually."
Last week, the Fed kept its main rate on hold at 1-1.25%, but announced an October start on the process of shrinking its balance sheet following years of asset purchases under its quantitative easing programme.
Even excluding the impact of hurricanes, growth in economic activity likely slowed a little in August according to data compiled by the Federal Reserve Bank of Chicago.
The Chicago Fed National Activity index slipped into negative territory in August, led by declines in production-related indicators. A zero value for the index has been associated with the national economy expanding at its historical trend.
Chicago's Federal Reserve district encompasses northern Illinois and Indiana, southern Wisconsin and lower Michigan - this includes the major industrial cities of Chicago and Detroit.
The headline index slipped to -0.31 in August, from 0.03 in July, reflecting a 0.9% drop in industrial production, while housing production and personal consumption also made negative contributions.
Employment indicators continued to show robust levels in the region's labour market, however, and sales, orders and inventories also made positive contributions.
In the Dallas Fed district, sometimes colloquially known as the "Oil Patch", the data over the next few weeks may be harder to interpret due to the damage and hardship wrought by Hurricane Harvey.
However, there was no such impact on the Dallas Fed manufacturing index which, contrary to forecasts of a drop to 11.5, rose to 21.3 in September from 17 in August.
The production index slipped slightly - dipping to 19.5 from 20.3 - but continued to show robust growth.
"Expectations regarding future business conditions continued to improve," the survey said. "The indexes of future general business activity and future company outlook remained elevated."
The dollar pulled higher against most of its main rivals, lifting the dollar index by 0.4% to 92.51.
Against the euro, the greenback climbed 0.6% to $1.1880 and gained 0.3% versus both the Swiss franc and Japan's yen. Sterling gained very slightly against the dollar, however, up 0.1% to $1.3518.