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Currently, the Fed aims for U.S. consumer prices to rise 2
percent a year but the central bank has rarely met that target
since adopting it in 2012, with inflation typically at less than
2 percent. Rosengren said it was possible the optimal rate of
inflation could shift with time.
"My own view is that we should be focused on an inflation range,
with the potential to move within the range as the optimal
inflation rate changes," Rosengren said in prepared remarks at
an event hosted by the Brookings Institution.
He said one possibility would be for the Fed to create a band
that allowed U.S. inflation to range between 1.5 percent and 3
percent.
Rosengren said the optimal rate of inflation might not be 2
percent if achieving that requires interest rates close to zero.
The Fed currently aims to keep overnight interbank lending rates
between 1-1/4 percent and 1-1/2 percent.
A number of Federal Reserve policymakers in recent weeks have
called for changes or urged study of the Fed's inflation
framework.
Earlier on Monday, San Francisco Fed President John Williams
said the Fed could better fight a recession by committing to
keep interest rates lower for longer to keep average inflation
on a steady upward path over the years, a framework known as
price level targeting.
(Reporting by Jason Lange; Editing by Andrea Ricci and Diane
Craft)
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