(Reuters) – Economic performance will determine when the Federal Reserve finally raises U.S. interest rates from near zero, an influential Fed official said on Monday, adding he hopes to tighten policy later this year.

“We have to see what unfolds,” New York Fed President William Dudley said in a speech that repeated cautious optimism that the U.S. economy will continue to expand and that inflation will begin to firm later this year.

Still, he said, the economy has further to go toward the central bank’s dual goals of full employment and 2-percent inflation.  Read more