Fed's Mester: We're not behind the curve on rates

Cleveland Federal Reserve President Loretta Mester told CNBC on Friday she sees the first interest rate hike from near-zero percent borrowing costs coming sometime next year.

While refusing to put a timetable on the move, she did say, "I'm not thinking we're behind the curve." Economists generally believe the rate hike will come in the summer.

Mester, a voting member on the Fed's policymaking panel this year, appeared on CNBC's "Squawk Box" shortly after the government's look at the October unemployment rate dipped to 5.8 percent from 5.9 percent.

She called the report an indication of a solid jobs market across the board. "I was at 5.5 percent by the end of next year. But maybe we'll get there sooner than that."

"My forecast is that the economy is going to grow around 3 percent over the next couple of years," she continued. "I believe inflation is going to pick back up gradually to the 2 percent goal."

She added: "I do not think we're in a deflationary environment. Although, the low oil prices are going to keep [consumer inflation] down in the near term."

The economy continues to improve, and policymakers will need to "calibrate our policy to that," she said.

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The central bank needs to be "forward looking" in deciding when to tighten policy based on inflation, she told reporters Thursday, adding that financial market volatility is to be expected as the rate move approaches.

Mester took the top spot at the Cleveland Fed in June following the retirement of Sandra Pianalto. Mester was formerly director of research at the Philadelphia Fed under its hawkish president, Charles Plosser.

Asked if she's hawkish like Plosser, Mester said she's neither a hawk nor a dove on monetary policy. "I consider myself an owl. Owls are wise." She added that she comes into each Fed policy meeting with an open mind.

Reuters contributed to this report.